How do you report your capital gains? What return do you use?

There are different ways that you either can or must report your capital gains depending on whether you are resident, or non-resident and whether you are in or out of Self Assessment.

At a glance

For individuals only: disposals before 6 April 2020

Are you UK resident? No = Gains on UK property reportable on NRCGT returns within 30 days. Tax payable within 30 days if not in Self-Assessment.
Yes  ↓
Do your total capital gains exceed the Annual Exemption?

       Yes        

  ↓ No
Do your total proceeds on capital disposals exceed four times the Annual Exemption?

  Yes

  ↓ No
  Gain is not reportable.
 
Are you already in Self-Assessment? Yes = Report on your self assessment return. Tax due 31 January following end of tax year.
No  ↓
Register for Self-Assessment. Tax due 31 January following end of tax year.

 

 For individuals only: disposals on or after 6 April 2020

 

Are you UK resident? No = Gains on UK property reportable online within 30 days. Tax payable within 30 days in all cases. NRCGT return only used for indirect disposals and disposals of mixed use properties.
Yes  ↓
Do your total capital gains exceed the Annual Exemption?

       Yes    

  ↓ No
Do your total proceeds on capital disposals exceed four times the Annual Exemption?

  Yes

  ↓ No
  Gain is not reportable. 
 
Are you selling a residential property? Yes = Must report gains online and pay the tax within 30 days of completion. If you are in self assessment must also include on self assessment return. If not only the 30 day return is required.
No  ↓
Are you already in Self-Assessment? Yes = Report on your self assessment return. Tax due 31 January following end of tax year.
No  ↓
Register for Self-Assessment. Tax due 31 January following end of tax year.

 

Overview

UK resident

Reporting requirement on disposals before 6 April 2020

  • If you make a capital gain you will need to report it to HMRC if:
    • The total of your gains exceed your available Annual Exemption, or
    • The total proceeds are more than four times the Annual Exemption (for 2019/20 this is £48,000).
  • If the total gains are below the Annual Exemption and total proceeds do not exceed four time the Annual Exemption, you are not required to report them to HMRC.
  • If you have a reportable capital gain(s) before 6 April 2020 you can report this to HMRC in two ways:
    • Using HMRC’s ‘real time’ Capital Gains Tax (CGT) service, or
    • Completing the Self-Assessment tax return.

Real time CGT reporting: Currently outside Self-Assessment

  • If you are currently outside the Self-Assessment regime, you do not have to register for Self-Assessment just to report a capital gain.
  • Instead you can use HMRC’s ‘real time’ service.
  • You can report your capital gain anytime between the date you have prepared your capital gain calculations and 31 December following the end of the tax year in which the capital gain took place.
    • For example, if you sold a holiday home at a gain in June 2018, you could report the gain using the real time service up to 31 December 2019. You could report it before the end of the 2018/19 tax year if you wished.
  • You will need to have or set up a Government Gateway account.
  • PDF or JPG copies of your calculations will need to be attached to your submissions.
  • The deadline for the tax remains 31 January following the end of the tax year, though HMRC will issue a payment reference number once they have processed the gain so that you can make payment sooner if you wish.
  • The main benefit of this system is that it allows for immediate calculation, reporting, and if necessary, payment of capital gains, which will ensure penalties and interest are avoided.
  • If you prefer you can register for Self-Assessment and report the gain on a Tax Return.

Real time CGT reporting: Already in Self-Assessment

  • If you are already in Self-Assessment, you can still use the real time service.
  • If you choose to report under the real time service, you will still have to report the gain on your tax return as well.

Reporting requirement on disposals on or after 6 April 2020

  • Gains on residential property disposals must now be declared on HMRC's online CGT disposal return (and the tax paid) using the Capital Gains Tax UK property disposal service, within 30 days of completion.
  • For all other capital gains nothing has changed.
  • Self Assessment (SA) reporting continues in parallel to the 30 day rule.
  • If you are SA registered and you make a capital disposal you may need to report it to HMRC.
  • You must include your disposal on your SA return if:
    • The total of your gains exceed your available Annual Exemption, or
    • The total proceeds are more than four times the Annual Exemption (for 2019/20 this is £48,000), 
      • Unless the gain is covered by Private Residence Relief.
      • If the total gains are below the Annual Exemption and total proceeds do not exceed four time the Annual Exemption, you are not required to report them to HMRC.
    • If you are not registered for SA, you do not need to report gains if there is no tax payable.
  • Further reporting obligations: 
    • Any adjustments to the figures or reliefs claimed can be made under SA and the tax due will be adjusted accordingly.
    • If you are not already in self-assessment you can register and include the gain on your self-assessment return but you are not required to if you do not have any other income or gains. This may mean you need to register. 
  • From 14 October 2020 it is possible to amend HMRC's online return after the 30 day window within the normal self assessment amendment window.
    • Amendments are only be permitted "so far as the return could, when originally delivered, have included the amendment by reference to things already done". It would seem that any changes  which do not meet this condition will need to be addressed in the self-assessment return instead.
    • HMRC have announced that they will not charge penalties for late returns by UK residents until after 31 July 2020. See Changes to CGT reporting: Soft landing period for penalties

  • If no CGT is due the new 30 day online return does not need to be filed.
  • In determining whether any tax is due, only losses incurred by the date of completion may be taken into account.
  • The grant of an option over residential property resulting in a capital gain triggers a requirement to file a return and pay the CGT within 30 days despite the fact that the grant and exercise of an option are generally treated as a single transaction on the later date that the option is exercised.
  • Digitally excluded taxpayers, or their agents, should call HMRC on 0300 200 3300 quoting form reference 'PPDCGT' to request a paper return which must come from HMRC each time; agents cannot simply copy returns and use for multiple clients.
    • Due to the length of time that paper returns will take HMRC have said that the 30 day clock for payment of CGT will be paused once the paper return is received to allow them time to process the return and to contact the taxpayer with details of how to make payment.

Using an agent to report disposals on or after 6 April 2020:

  • Agents can report disposals on behalf of clients but must be specifically authorised to do so via their agent services account (ASA) as existing 64-8 forms do not cover this.
    • The client must first set up a Capital Gains Tax on UK property account. They will be issued with a 15 digit reference number.
    • The client then passes their reference number and postcode to their agent who can request authorisation to manage the client's CGT property account. They do this through their ASA.
    • The client will receive a link to click on to approve the agent to act. Once approved the agent can prepare and file the return for the client.
    • Once the return is filed the agent and client should receive an email from HMRC with instructions for making payment. It appears that payment cannot be made simultaneously with the filing of the return as a reference is required.
    • Anyone who cannot authorise their agent online and does not wish to file a paper return can go through a telephone authorisation process with HMRC instead.
  • The exception to this is for estates. Agents can only submit paper returns on behalf of personal representatives (PRs) as there is not yet any facility for PR's to authorise agents online. However the PR's can file online returns themselves by setting up an online property account.

Trustees who need to report disposals:

  • Where a trust needs to report a gain and has not already registered under the trust registration service, they will need to do so before they can report the gain and pay the capital gains tax. See UK Trusts.

Non-UK residents

  • Non-UK residents are partly outside of the UK CGT regime.
    • From April 2015. UK residential property sold at a capital gain is subject to CGT.
    • From April 2019, all non resident UK property sales and indirect disposals of an interest in a 'UK property rich' entity are subject to NRCGT whether the property is residential or commercial.
    • See Non-Resident Capital Gains Tax (NRCGT).
  • All disposals must now be reported within 30 days of completion of conveyance.

For NRCGT disposals before 6 April 2020:

  • The NRCGT must also be paid within 30 days unless the non-resident is already in Self-Assessment, in which case it can be paid by the normal 31 January deadline. See CGT: Payment of tax 

For NRCGT disposals on or after 6 April 2020: 

  • All NRCGT must be paid within 30 days whether the non-resident is in Self-Assessment or not. see CGT: Payment of tax.
  • HMRC's 'Capital Gains Tax UK property disposal service' must be used by the non-resident or their agent/adviser to report the gain, except in the following circumstances where the NRCGT return can continue to be used:
    • Disposals of mixed use properties, e.g. part residential, part commercial such as a doctors surgery or shop with a flat above.
    • Indirect disposals of a property rich entity where at least 75% of the gross asset value is attributable to UK property.
  • The non-resident taxpayer can set up a UK property account within the new service here without needing a government gateway ID, by going to 'Create sign-in details' and providing an email address.

Comments (22)

Rated 5 out of 5 based on 3 voters
This comment was minimized by the moderator on the site

Quick question please - Can an agent file the online CG calculation. Or do you need to complete the payment details at the same time.
Thank you.

Guest
This comment was minimized by the moderator on the site

After taking off the £12,300 capital gains allowance, am I correct in thinking that for residential, 18% would be payable on £37,500 minus taxable income, and 28% on the portion over £37,500?

Guest
This comment was minimized by the moderator on the site

I am sorry we have not the capacity to respond to individual tax queries.

If you would like professional advice I recommend that you use the Virtual Tax Partner support service - the link is here:
https://www.rossmartin.co.uk/ask-virtual-tax-part...

I am sorry we have not the capacity to respond to individual tax queries.

If you would like professional advice I recommend that you use the Virtual Tax Partner support service - the link is here:
https://www.rossmartin.co.uk/ask-virtual-tax-partner-support

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Guest
This comment was minimized by the moderator on the site

Is land that has planning consent for houses residential property for the purpose of the 30 day payment? I will have to get a 1982 valuation. What do I do if this is not ready in time?

Guest
This comment was minimized by the moderator on the site

I am sorry we have not the capacity to respond to individual tax queries.

If you would like professional advice I recommend that you use the Virtual Tax Partner support service - the link is here:
https://www.rossmartin.co.uk/ask-virtual-tax-part...

I am sorry we have not the capacity to respond to individual tax queries.

If you would like professional advice I recommend that you use the Virtual Tax Partner support service - the link is here:
https://www.rossmartin.co.uk/ask-virtual-tax-partner-support

Read More
Guest
This comment was minimized by the moderator on the site

This relates to CGT on sale of listed UK shares.

When you say 'total' capital gains in your flow chart, do you mean 'net'?

The case I am thinking of is where gains are offset with losses (in the same tax year) which brings the net gain down...

This relates to CGT on sale of listed UK shares.

When you say 'total' capital gains in your flow chart, do you mean 'net'?

The case I am thinking of is where gains are offset with losses (in the same tax year) which brings the net gain down to under the annual exemption amount.

If, in addition, the total proceeds from the disposals are less than 4 x the exemption amount, the flow chart leads me to believe the gains are not reportable.

Yes? No?

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Guest
This comment was minimized by the moderator on the site

I am sorry we have not the capacity to respond to individual tax queries.

If you would like professional advice I recommend that you use the Virtual Tax Partner support service - the link is here:
https://www.rossmartin.co.uk/ask-virtual-tax-part...

I am sorry we have not the capacity to respond to individual tax queries.

If you would like professional advice I recommend that you use the Virtual Tax Partner support service - the link is here:
https://www.rossmartin.co.uk/ask-virtual-tax-partner-support

Read More
Guest
This comment was minimized by the moderator on the site

My house sale completed at the beginning of the month. The house was jointly owned by my ex-partner and me. I moved out three years ago but she stayed living in the house. I'm liable for Capital Gains Tax which I want to pay but she is...

My house sale completed at the beginning of the month. The house was jointly owned by my ex-partner and me. I moved out three years ago but she stayed living in the house. I'm liable for Capital Gains Tax which I want to pay but she is withholding consent for the proceeds of the sale to be released by the conveyancing solicitor. I can't afford to pay the CGT until I have my half of the sale proceeds. What should I do?

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Guest
This comment was minimized by the moderator on the site

I am sorry we have not the capacity to respond to individual tax queries.

If you would like professional advice I recommend that you use the Virtual Tax Partner support service - the link is here:
https://www.rossmartin.co.uk/ask-virtual-tax-part...

I am sorry we have not the capacity to respond to individual tax queries.

If you would like professional advice I recommend that you use the Virtual Tax Partner support service - the link is here:
https://www.rossmartin.co.uk/ask-virtual-tax-partner-support

Read More
Guest
This comment was minimized by the moderator on the site

Mixed Use Property

I have a client who just sold a shop with a flat above.

Looking at HMRC's website it seems to suggest only non-resident individuals need to declare mixed use assets.

Is this correct?

Guest
This comment was minimized by the moderator on the site

I am sorry we have not the capacity to respond to individual tax queries.

If you would like professional advice I recommend that you use the Virtual Tax Partner support service - the link is here:
https://www.rossmartin.co.uk/ask-virtual-tax-part...

I am sorry we have not the capacity to respond to individual tax queries.

If you would like professional advice I recommend that you use the Virtual Tax Partner support service - the link is here:
https://www.rossmartin.co.uk/ask-virtual-tax-partner-support

Read More
Guest
This comment was minimized by the moderator on the site

I am in the process of completing my first CGT return for a client and now I have authority, which was a faff, I have to estimate their income. My client is currently not working. If I go for the lower rate at 18% and he then ends up earning,...

I am in the process of completing my first CGT return for a client and now I have authority, which was a faff, I have to estimate their income. My client is currently not working. If I go for the lower rate at 18% and he then ends up earning, will they be charged interest on the extra bit that wasn't paid? Also if its the other way round, can they get a refund via the CGT login or would they have to wait for the SATR to be submitted.

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Guest
This comment was minimized by the moderator on the site

You can only do what is reasonable given the facts that you are aware of at the time that the gain is reported.

Guest
This comment was minimized by the moderator on the site

Hi. I have a property capital gain from after 5th April so need to pay the tax within 30 days. The HMRC websites state that separate registration is required but I cannot find access to do this despite going round in circles. The self assessment...

Hi. I have a property capital gain from after 5th April so need to pay the tax within 30 days. The HMRC websites state that separate registration is required but I cannot find access to do this despite going round in circles. The self assessment log in will not deal with this. There is plenty of info on how to calculate, which I don"t need, but none on the mechanics of joining the new "club" or how to pay.
After waiting 30 minutes on the general enquiries line to be told the Technicians at the next level have to deal with this but they are too busy and will call back in 3 days. At this rate the 30 days will disappear. Any ideas anybody?

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Guest
This comment was minimized by the moderator on the site

Maybe HMRC's portal was not working when you looked. Go to this page https://www.gov.uk/capital-gains-tax/report-and-pay-capital-gains-tax
and scroll down to where you can see "Report gains and pay straight away...If you’re a UK resident you can...

Maybe HMRC's portal was not working when you looked. Go to this page https://www.gov.uk/capital-gains-tax/report-and-pay-capital-gains-tax
and scroll down to where you can see "Report gains and pay straight away...If you’re a UK resident you can use the ‘real time’ Capital Gains Tax service.

Click on the 'real time' Capital Gains Tax service and it takes you to a log in.

If all else fails and you cannot do it, you can always make a payment of tax using your self assessment reference and then write in to explain your plight. This may not be enough to avoid a penalty though.

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Guest
This comment was minimized by the moderator on the site

If a residential property is sold and after PRR and letting relief, he gain is NIL.
i.e Gain 150k, less PRR 135k, and Letting relief 15k.

Reporting to HMRC still needed with calculations?

Thank you

Guest
This comment was minimized by the moderator on the site

Have you tried the flow chart above? It looks like your sales proceeds will be easily more than 4 times your annual CGT exemption. The Virtual Tax Partner service at http://www.VtaxP.co.uk can provide you with reporting assistance.

Guest
This comment was minimized by the moderator on the site

My question was, if the gain does not exceed the Annual Exemption, but Total Proceeds are over four times annual exemption, does a report still need to be filed within 30 days? Or is this included in Self Assessment only?

The HMRC guidance...

My question was, if the gain does not exceed the Annual Exemption, but Total Proceeds are over four times annual exemption, does a report still need to be filed within 30 days? Or is this included in Self Assessment only?

The HMRC guidance suggests that a return only needs to be made within 30 days of completion when CGT is payable. Please could you confirm?

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