Following recent concerns around how it works in certain circumstances, HMRC have now issued a set of Frequently Asked Questions (FAQs) for the Capital Gains Tax (CGT) online property reporting service.

Since April 2020 disposals of UK residential property have had to be reported and any CGT due paid within 30 days of completion using a new Online property reporting service. The main exception to this is where Private Residence Relief applies.

Since 1 August 2020 penalties have applied for late returns. There have been various problems highlighted since the requirement was introduced, prompting HMRC to issue this list of twenty-six FAQs which deal with a variety of issues such as:

  • How and when to deal with amendments to submitted returns.
    • Once the taxpayer has filed the relevant Self Assessment (SA) return they cannot amend the property reporting return and must instead amend their SA return.
  • Will overpayments be refunded automatically?
    • No, a repayment must be requested through the property reporting service.
  • Can my client offset the amount of Capital Gains Tax overpaid against their SA tax due?
    • If an overpayment of Capital Gains Tax is showing when the SA tax return is processed HMRC will need to manually allocate this overpayment against the total SA liability. This will involve checking what has already been declared and paid on the UK Property Disposal Return.
  • I already have a 64-8 in place for my client’s SA tax return, do I need to complete the agent authorisation online for UK Property Disposal online service?
    • Yes, a separate digital authorisation needs to take place before you will be able to file your client’s UK Property Disposal return online. Your client needs to create their UK Property Disposal account online first then give you their CGT account reference number. You then log in via your Agent Services Account and enter the CGT account reference number as the customer identifier.
  • Can I use the UK Property Disposal online service to manage a deceased estate’s CGT on UK Property Account, if the personal representative has already appointed another agent to manage their own personal UK Property Disposal account?
    • No, an individual can only authorise one agent to manage their UK Property Disposal account at a time. If the client does not want to replace the existing agent, you must contact HMRC taxes helpline and request a paper UK Property Disposal return.
  • How can my client claim Business Asset Disposal Relief (BADR) on their UK Property Disposal return?
    • Customers using the online UK Property Disposal service can claim BADR in the relief section by ticking 'Other'. For disposals in which BADR is claimed the CGT owing must be worked out manually and the figure produced by the inbuilt calculator must be overridden with the figure with a computation showing how the CGT owing has been arrived being attached.
  • My client is a Non-resident individual, can they use the UK Property Disposal online service?
    • Yes, they can.
  • My client has a Personal Tax Account. Do they need to register for a UK Property Disposal account?
    • Yes, they will need to register separately but they can use the same credentials to set up the UK Property Disposal account.
  • My Client is a UK resident who has disposed of a UK mixed-use property (part of the property is residential and the other part non-residential). Do I need to complete a UK Property Disposal return?
    • A UK Property Disposal return will be required if the residential property disposal gives rise to a gain with CGT due. However, if the non-residential disposal gives rise to a loss, this loss could be offset against the residential element when working out if they must file a UK Property Disposal return.

Useful guides on this topic

CGT: Payment of tax
When is Capital Gains Tax (CGT) due? Can I pay in instalments? What are the penalties if I pay late? What are the new rules from April 2020?

CGT: Reporting, How to report CGT?
How do you report your capital gains? What return do you use?

CGT: deductible expenditure
What expenditure is allowable for Capital Gains Tax (CGT)? What about loan interest, early redemption fees etc?

Private Residence Relief
What is Private Residence relief (PRR)? What are the qualifying conditions? Can you claim relief on two homes? How do you claim PRR? Can you claim PRR if you develop your garden?

Business Asset Disposal Relief (Entrepreneurs' Relief): Disposal of a business
Entrepreneurs' Relief (ER) was renamed Business Asset Disposal Relief (BADR) by Finance Act 2020.  When does BADR apply? What is the rate of BADR? How to claim BADR. Case law on BADR.  

Non-resident CGT: UK property
Capital Gains Tax, non-residents and UK property.

External link

HMRC FAQs: UK Property Disposal Question and Answer document 12/07/2021 

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