CGT Changes And Not Just Covid-19 Rental Arrears To Contend With
Those landlords who are selling properties from their portfolio besides having to contend with the affects of the Coronavirus upon rental payments, will also have to deal with HMRC’s new Capital Gains Tax legislation which came into force from the beginning of April.
As usual all UK residents must submit their CGT returns however more importantly they must also pay any CGT due from sales of residential properties, within 30 days of completion.
Those people under self assessment were previously able to inform the HMRC when they had sold their property and were allowed to pay the CGT owed through their tax return.
It is of the utmost importance that sellers must be mindful of the vastly reduced payment timescale because they if they fail to pay within the 30 days, they will be subject to additional charges/fine.
Hilesh Chavda, a legal tax specialist in Royds Withy King’s Private Wealth team, said: “Where CGT is due, the change could mean that sellers have to get funds in place to cover the CGT liability before the sale is completed as 30 days is not very long at all. This could be a particular issue where there are large historic gains.”