Where a UK resident disposes of a UK residential property, and there is capital gains tax to pay, the taxpayer must report the gain and pay the tax, generally within 30 days of the completion date of the deal. Non-residents need to report and pay the CGT due on all types of UK property within 30 days.
This report needs to be made using online UK Property Reporting Service. In previous newsletters we have highlighted the many problems with this service (see for example: 5 November 2020 and 20 May 2021). For some clients, it is impossible to get the online account set up and authorised, before the 30-day deadline comes round. Fortunately, paper returns are permitted and in those cases an extension to the deadline is possible (see newsletter: 23 September 2021)
The OTS recommended that the 30-day deadline should be extended to 60 days, and the Government has listened. For deals completed on and after 27 October 2021 the gain must be reported and the CGT paid within 60 days of the completion date. Property deals completed before that date still need to be reported within 30 days, if CGT is payable.
In another simplification, the reporting of gains from mixed-use property has been amended. ‘Mixed use’ means a building that has both residential and non-residential parts, eg shop with a flat above. For completions on and after 27 October, only the residential part of the gain has to be reported on the UK property account of a person who is UK tax resident.
Written by the Tax Advice Network