Landlords hit by fines in 2020
Since April 2020 HMRC have introduced new, significantly reduced reporting and payment times for CGT on the sale of second homes and buy to let properties to just 30 days from the date of completion. Before April 2020 any landlord had up to 22 months to settle and this change has led to a lot of landlords being caught out.
Within 30 days of completion, you now to have to notify HMRC of the gain on a CGT return and pay any CGT owed – failure to do this will see penalties levied and this has been the case in increasing numbers over the past year. Whilst HMRC claims to have taken a more lenient approach to people paying taxes this year there have still been over 13,000 penalties issued.
Capital Gains Tax (CGT) is a tax on the profit you make when you sell or ‘dispose’ of an asset that has increased in value since you purchased it. Most people assume that disposing of an asset refers to the sale, but it can also include:
- Gifting or transferring to somebody else
- Exchanging it for another asset
- Receiving compensation (insurance claim) due to loss or damage of the asset
In a recent webinar, David White and Raj Jiwani, our Joint Managing Directors discussed this and other issues related to property tax. Listen to the webinar in full here.