Pay CGT in 30 days

Capital Gains Tax due on sales of residential property completed on and after 6 April 2020 will have to be paid within 30 days of the completion date. Non-resident owners already have to pay the CGT within 30 days, but from April 2020 this short payment period will also apply to all UK-based sellers.

This is going to come as a shock to many landlords and their accountants, who have been used to paying CGT on property sales up to 22 months after the transaction, ie by 31 January following the tax year end.

The taxpayer, or their agent, will also have to complete a new online return to report the CGT due within 30 days. This new online system is currently being tested by HMRC, who are looking for agents and their clients to take part in that trial.

It appears that this new online reporting system is not the same as the real time transaction return, which we outlined on 19 April 2018. That real time CGT reporting system is only open to taxpayers to use, and not their agents.

The new online CGT reporting system will be open to agents to use, but we will need a separate agent authorisation to use the service on behalf of our client, as the authorisation to act for income tax will not be sufficient.

 

Written by the Tax Advice Network