The way that capital gains tax on property gains is paid is changing from 6 April 2020.

From 6 April 2020, where there is any capital gains tax (CGT) due on a residential property disposal:

  • a return will need to be filed to report the gain to HMRC; and
  • the “notional” CGT due will need to be paid.

These are both subject to a 30day time limit. This starts at the date of completion, even though the gain itself is treated as made on the date of exchange of contracts, i.e. when the sale becomes binding.

There are some occasions where a return will not be required. This will be the case where:

  • the gain is exempt due to the availability of private residence relief (PRR), enterprise investment scheme deferral, or other relief, e.g. holdover relief
  • there is enough available annual exemption to ensure no tax is payable
  • the gain will be reduced to £nil by brought forward capital losses.

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