If you are a UK resident and you are selling your residential property, any Capital Gains Tax due will have to be calculated and paid to HMRC within 60 days.

For the vast majority of sales, no Capital Gains Tax (CGT) will be due – because of Private Residence Relief which applies to the sale of family homes – but for those properties which have been held as investment properties, the new rules will apply.

Since 27th October 2021, it has been necessary to work out the Capital Gain, send in a ‘Residential Property Return’, PLUS any tax due, within 60 days of the sale. (If no tax is due, then the 60 day rule is not relevant.)

CGT payments are effectively a payment on account of Capital Gains Tax – and the final amount owed or repayable will be calculated within the normal Self-Assessment Tax Return.

So, it may well be the case that CGT is payable on selling a property within 60 days – but that a loss on (for example) the sale of shares leads to the Capital Gains Tax paid being refunded once the year’s Self-Assessment Tax Return has been submitted.

It is vitally important that anyone likely to be affected by the new rules contacts their accountant before any sale is made – to give time for the tax due to be calculated and the Return to be made.  There are late filing penalties when either the Return is filed, or the tax is paid, later than 60 days.

If you’re in need of advice, contact us today for a free consultation. Our telephone number is 01793 818400. Alternatively, you can email us at admin@ams-accountancy.co.uk or complete our online contact form.