Property Capital Gain Changes April 2020

Updated: Aug 26, 2020

· The new rules mean that from 6 April 2020 you will have a 30-day deadline from completion of a sale to calculate the gain, report it and pay it to HMRC. Currently, depending upon the timing of the sale, capital gains tax is due anything between 10 months and 22 months after completion of the sale.

Please note if this is your only main residence you do not have to file any Capital Gain tax.

Due to coronavirus (COVID-19), UK residents will not get a late filing penalty for any transactions completed on or after 6 April 2020 to 1 July 2020 and reported up to 31 July 2020.

Transactions completed from 1 July 2020 will receive a late filing penalty if they are not reported within 30 calendar days.

Interest will be charged if the tax remains unpaid after 30 days for all transactions from 6 April 2020.

Tax Rate

The amount is within the basic Income Tax band you’ll pay 10% on your gains (or 18% on residential property). You’ll pay 20% (or 28% on residential property) on any amount above the basic tax rate

Private Residence Relief

You’ll pay tax on your ‘chargeable gain’. This is your gain minus any Private Residence Relief you’re eligible for.

You get full relief for:

· the years you lived in the home

· the last 9 months you owned the home - even if you were not living there at the time

If you sold the property between 6 April 2014 and 6 April 2020, you get relief for the last 18 months you owned it.

If you only own one home and you’re disabled, in long-term residential care or sold the property before 6 April 2014 you get full relief for the last 36 months you owned it.

Get in touch to find out more.

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