CGT on Residential Property

8th November 2021

LinkedIn

In the Chancellor’s Autumn Budget, we were pleased to see that the government have seen sense and doubled the period for filing and payment of capital gains tax (CGT) on residential property from 30 days to 60 days.

The change applies from 27 October 2021 and sees the deadline for residents to report and pay CGT after selling UK residential property increase from 30 days after the completion date to 60 days.  This means that, when selling a residential property, UK resident taxpayers must assess whether or not any CGT is payable in respect of the transaction and, if so, must ensure that the CGT is reported and paid to HMRC within 60 days of completion.

For non-UK residents disposing of property in the UK, this deadline will also increase from 30 days to 60 days.  It’s important to note that non-UK residents must complete a CGT on Residential Property return within 60 days regardless of whether or not there is any CGT payable on the disposal.

When mixed-use property is disposed of by UK residents, legislation will also clarify that the 60-day payment window will only apply to the residential element of the property gain.

The Treasury says that these changes will ensure that taxpayers have sufficient time to report and pay CGT, as recommended by the Office of Tax Simplification (OTS). The Association of Accounting Technicians (AAT) has campaigned for this change for the past 18 months.

Phil Hall, Head of Public Affairs and Public Policy at the AAT, said:

‘It’s a common-sense measure that helps taxpayers and their accountants whilst maintaining increased revenue for the Exchequer. Very pleased that HM Treasury and HMRC took on board the views of our members and changed their position accordingly.’

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