When do you need to report your capital gains tax? How do you report your capital gains tax?
There are different ways to report capital gains tax depending on whether you are a UK resident or a non resident.
Until the new rules were introduced for non residents from April 2015 and for UK residents from April 2020, the capital gains tax would be reported in the self assessment tax return by completed capital gains tax pages by the 31 January following the end of the tax year of disposal.
For example, if a person has a disposal of a property on 15 April 2021, the relevant tax year would be 2021/22, and the capital gains tax return must be submitted by 31 January 2023. Any capital gain tax must also be paid by 31 January 2023. There was a gap of twenty-two months from the date of the disposal of the property to the date of reporting and capital gains tax payment deadline.
Since April 2020, HMRC has requested that non-resident individuals file their capital gains tax returns within 30 days of the disposal of property. Here completion statement is the disposal of the property. This was then extended to commercial properties sold by non-residents in 2019 and then eventually to the UK residents from April 2020.
Reporting Capital Gains Tax on or after 6 April 2020
Capital gains on any disposal would be report via either self assessment tax return or real-time capital gains tax reporting service. Where the individual is within self assessment tax return, their tax return must include the capital gains tax information if:
- The total gains from all the disposals during the tax year are more than capital gains tax exemption
- The total proceeds are more than four times the annual exemption. Please note that from 6 April 2023, the four times the annual exemption rule has been replaced by a flat £50,000 threshold.
Gains on UK property are reportable online via real time capital gains tax reporting service. They are required to be reported within:
- 60 days if the completion date was on or after 27 October 2021
- 30 days if the completion date was between 6 April 2020 to 26 October 2021
Residents and Non resident
Where a non resident makes a disposal of the property, they are required to submit their capital gains tax return whether they make any profit or not. However, UK residents are only required to file their capital gains tax return if they make a capital gain on the disposal of the property.
Completion date of the property not exchange
The reporting deadline of 30 and 60 days starts from the completion date of the property. Here the exchange date of the property is not relevant for reporting purposes. The deadline of 30 or 60 days would be calculated from the date of the completion of the property.
How Zahtax can help with your capital gains tax
Our expert team of capital gains tax specialists can help with all aspects of capital gains tax issues, from tax planning to the compliance aspect of the capital gains, such as
- Timing of the disposal: whether the timing of the disposal of the property can make any difference in tax liability
- Pre-disposal capital gains tax calculation to give you an idea of expected capital gains tax liability. This will help you to plan your finances.
- Calculation of your capital gains tax liability after the completion statement
- Submission of your capital gains tax return to HMRC within 30/days as required
- Submission of your self assessment tax return (if required), including your capital gains information
