After months of speculation, HMRC has confirmed that a Capital Gains Tax property return must be filed for a disposal, even if it has already been reported on a self assessment tax return.

In April 2020, the government made it a requirement to report disposals of UK residential property and pay the resulting Capital Gains Tax (CGT) within 60 days of completion (30 days if the disposal was before 27 October 2021). Earlier this year, HMRC also advised that the CGT property (PPD) return should be filed before the self assessment (SA) return.

Unfortunately, many qualifying disposals were not identified until preparation for the 2020/21 SA returns began and it is not possible to file a CGT return electronically after your SA return. With the SA return deadline approaching and issues with the CGT declaration system, many taxpayers filed the SA return without filing a CGT return beforehand.

Almost six months later, HMRC has announced that any CGT returns that were not filed before the SA return must still be submitted, but via a paper return rather than online.

How will the HMRC update affect me?

When making a disposal, you need to remember to file a CGT return, even if it has already been reported on your self assessment return. It is essential to file the CGT return before you submit your SA return.

Failure to file a CGT return for a qualifying disposal can result in financial penalties from HMRC and interest on outstanding payments.

If you filed your SA return within 60 days of the transaction’s completion (or 30 days if the disposal was before 27 October 2021), you are not required to submit a separate CGT return. This is the only exemption for filing CGT returns in respect of disposals that give rise to a CGT liability.

How do I file an outstanding CGT property return?

If you have an outstanding CGT property return, you must file it via paper return as soon as possible. You can request a paper return form by calling HMRC’s CGT enquiries helpline on 0300 200 3300.

If there is a 64-8 authorisation in place for your agent, HMRC will issue a paper CGT form to your agent on request if they call the agent dedicated helpline on 0300 200 3311.

If you need further support with CGT or another area of personal tax, contact us today to discuss your needs with one of our tax experts. You can also find out more about the extensive specialist tax services we offer at PKF Smith Cooper on our website.

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