Selling a rental property? 🏠 Tax now due within 60 days!

Selling a rental property?

Capital Gains Tax (CGT) is now payable within 60 days of completing the sale of a residential rental property and is reportable via a standalone online CGT Return.

The simple takeaway - If you’re planning on selling a property – please let us know.

Background info: CGT standalone Returns were first introduced from 6 April 2020 with a 30-day deadline. This was extended to 60 days at the Autumn Budget held on 27 October 2021.

Details of note:

1. while the Return is due and payable within 60 days of completion, the taxable-date is still the date contracts are exchanged (unless completion is conditional per the contract).

2. The 60-day Return is not required if the taxpayer has already declared the sale on their usual SA Tax Return (submitted by 4 June following the tax year-end), in which case, the tax is payable by the usual 31 January deadline (not 60 days) (this is only possible if a property sale exchanges between 6 Feb - 5 Apr in any year and an SA Tax Return is submitted between 6 Apr - 4 Jun).

3. Likewise, the 60-day Return is not required if there is no Capital Gains Tax payable (e.g. the gain is covered by the CGT Annual Exemption).

Source info: https://www.tax.service.gov.uk/capital-gains-tax-uk-property/start/report-pay-capital-gains-tax-uk-property

These rules a nicely summarised in HMRC's video

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What if the deadline is missed? ⚠️

Penalties apply:

• 1 day late → £100 fixed penalty

• 6 months late → additional £300 or 5% of the tax due (whichever is greater)

• 12 months late → another £300 or 5% of the tax due (whichever is greater)

• Late payment interest is also charged from day 61.

  
  

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