File CGT property disposal returns before SA returns

HMRC reminds taxpayers that Capital Gains Tax UK property returns are due before the relevant self-assessment return.

Starting April 2020, the UK government mandated that UK residents report and pay CGT on the sale of UK residential property within 30 days. For any completions on or after 21 October 2021, the timeframe has been extended to 60 days.

It is important to note that it is not possible to file a CGT on property disposal (CGT PPD) return after a disposal has been reported on a self-assessment return. Even if the requirement for a CGT PPD return is only discovered while preparing the SA return, the CGT PPD return must be submitted first.

The only exemption is if the SA return is filed within 60 days of the property transaction’s completion (i.e., before the deadline for the CGT PPD return). It is not essential to file a CGT PPD return in this circumstance.

In December 2021, HMRC finally released its guidelines on reporting capital gains on UK property, and the document is still being updated.

Self-assessment payment offsets

In 2020/21, if the CGT liability on the SA return is less than the CGT reported and paid on the CGT PPD return, a manual offset must be requested by calling HMRC.

For the 2021/22 returns, this problem has been mainly resolved. Any CGT that has been paid in error is deducted from the amount of income tax owed. The adjustment, however, does not apply to cases when the SA return indicates a total refund. In that case, you must still contact HMRC to request a refund of the CGT you paid.