HM Revenue & Customs has issued a new warning to buy to let and Holliday home owners about a major change in Capital Gains Tax coming soon.
From April 6 any UK resident selling a residential property in this country will have just 30 days to tell HMRC and pay any CGT owed.
There are also changes for non-UK residents selling both residential and non-residential property in this country.
Non-UK residents will still be required to tell HMRC within 30 days whether there is tax to pay or not and will no longer to be able to defer payment via their Self Assessment return.
HMRC will launch a new online service which it claims will make it easier to report and pay any CGT.
As a reminder, the Revenue says owners may need to make a CGTreport and make a payment when, for example, they sell or otherwise dispose of:
- a property that they’ve not used as your main home;
- a holiday home;
- a property which they let out for people to live in; and
- a property that they’ve inherited and have not used as their main home.
HMRC deputy director Sarah Kelsey says: “We want to help customers know exactly what they need to do, as it’s really important that everyone involved with the sale of a residential property fully understands the changes.
“People don’t usually have to pay Capital Gains Tax if they sell the house they live in, but this is a significant change for customers who do have to pay the tax and who up to this point would include the gain in their Self Assessment return. There will be lots of help and guidance available to individuals and agents, or those representing trusts, and we are providing a new online service to make it easier for all our customers to both notify and pay online within 30 days”.
If sellers don’t tell HMRC about any Capital Gains Tax within 30 days of completion, they may be sent a penalty as well as having to pay interest on what they owe.
Further advice and guidance is available at GOV.UK.