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HMRC Improve CGT Reporting Service Functionality

HMRC have updated their capital gains tax (CGT) reporting system to allow reports of second and subsequent disposals of UK residential property to be made online.

A new requirement to report and pay CGT on disposals of UK residential property within 30 days of completion applies to disposals made by UK resident taxpayers on or after 6 April 2020.

You may have to pay Capital Gains Tax if you make a profit (‘gain’) when you sell (or ‘dispose of’) property that’s not your home. For example, buy-to-let properties, land or inherited property.

In most cases you do not need to pay the tax when you sell your main home.

For UK property disposals made from 6 April 2020, you have 30 days after the property’s completion date to report and pay any Capital Gains Tax due on your UK property disposals.

Due to coronavirus (Covid-19) HMRC did not issue late penalties to any transactions completed between 6 April and 30 June 2020, provided the gain was reported and any tax due paid by 31 July 2020. Anyone who completes the sale of a property from 1 July 2020 onwards has 30 calendar days to report and pay the tax due.

Transactions completed from 1 July 2020 will receive a late filing penalty if they are not reported within 30 calendar days.

Interest will be charged if the tax remains unpaid after 30 days for all transactions from 6 April 2020.

How to report and pay the tax

You’ll need to create a Capital Gains Tax on UK property account before you can report and pay the tax using this service.

If you’re a resident or representing a trust, you can use this service to:

  • Report the disposal of UK residential property or land made from 6 April 2020
  • Pay any tax you might owe for that disposal
  • View your previous and current returns

At the moment, if you need to amend an existing return you will need to contact HMRC.

If you’re a non-resident you must use this service to report sales or disposals from 6 April 2020 of:

  • Residential UK property or land
  • Non-residential UK property or land
  • Mixed use UK property or land
  • Rights to assets that derive at least 75% of their value from UK land (indirect disposals)

If you’re a non-resident, you must report all sales or disposals of UK property, even if you have no tax to pay or have made a loss.

Before you start

To use this service, you’ll need a Government Gateway user ID and password. If you do not have a user ID, you can create one.

You can contact HMRC if you need help accessing the service.

Get the following information ready:

  • Property address and postcode
  • Date you got the property
  • Date you exchanged contracts when you were selling or disposing of the property
  • Date you stopped being the property’s owner (completion date)
  • Value of the property when you got it
  • Value of the property when you sold or disposed of it
  • Costs of buying, selling or making improvements to the property
  • Details of any tax reliefs, allowances or exemptions you’re entitled to claim
  • Property type, if you’re a non-resident

Source: Gov UK