We are still await any hard figures regarding allowances and rates for Capital Gains Taxes from this April onward, we'll get confirmation at the Budget. However there is one confirmed change that you will need to be aware of.
Anyone UK resident selling a residential property will now have to inform the Taxman within 30 days of the sale and pay any CGT (Capital Gains Tax) applicable.
The above applies if the contract for the sale is made on or after April 6th 2020.
Capital gains are due on residential property sales that do not qualify for the private residence relief, or are holiday homes, or property owned by a landlord for renting, as well as inherited property not used as main residence.
Tax is levied at 18 or 28 percent of the gain, based on the individual's tax rate/if they are a basic or higher rate taxpayer.
You can reduce the amount of capital gains tax payable by using losses and costs associated with the sale, tax reliefs, the annual exempt allowance (currently £12,000). You can also avoid CGT if the property was sold to a spouse or civil partner.
There will be penalties applied for people not adhering to the new guidelines and timings, include interest on amounts deemed owed.
In order to help meet demands, HMRC will launch an online service to make the CGT payment.
The new rules bring CGT notification and payment into line with non-UK residents, who have to report within 30 days of sale of UK property. From April 6th 2020, non-UK residents too will have to pay within 30 days of sale.