New and significant reporting requirements were introduced 6th April 2020 where a UK resident individual is due to pay CGT on the disposal of a UK residential property.
A new standalone return will need to be filed online with HMRC, together with a CGT payment on account.
Both of these are due within 30 days of completion of the transaction.
Interest and penalties will be charged if the deadline is missed.
When Does This System Get Implemented?
As per previous updates, resultant from the Covid-19 pandemic, the Government delayed the introduction of this new regime with a “soft landing” approach for property disposals which fail to be reported in the first quarter, following the introduction of the new rules.
Ultimately:
HMRC are allowing a period of time to adjust and will not issue late filing penalties for CGT payment on account returns received late; up to and including 31 July 2020.
For UK residents, this means transactions completed between 6 April and 30 June 2020 must be reported by 31 July 2020.
Transactions completed from 1 July 2020 onwards will receive a late filing penalty if they are not reported within 30 calendar days.
Interest will accrue if the tax remains unpaid after 30 days.
Do You Need Assistance?
Individuals who have recent sold or are intending selling property must be aware of the new rules.
You are advised to seek timely advice on your position in order to meet the new obligations.
This is even more important now that the “soft landing” approach from HMRC has ended.
Disposals made after 1st July 2020 will need to be reported with 30 days of completion, with tax to be paid at the same time.
