Profit from your home
Contrary to popular belief, the profit you make when you sell your home, or a former home, is not automatically exempt from Capital Gains Tax (CGT).
This tax exemption applies to gains that relate to periods in which you lived in the property as your main home. However, it can be extended to certain periods when you were not living in that property.
For example, the last nine months of ownership are exempt from tax, which is extended to 36 months where the owner or their spouse is disabled or has moved into residential care.
Where you sell or transfer any UK residential property from 6 April 2020, any capital gain producing a CGT liability needs to be reported, and the CGT paid to HMRC, within 30 days of the completion date.
This must be done through a new online UK Property Account, but the gain must also be reported on your self-assessment tax return for the year, if you are someone who has to file one (e.g. due to being self employed or having rental income). We can help you with this reporting.
Talk to us if you are planning to sell any residential property in 2021, so we can collect all the information needed to calculate the gain within the 30-day reporting period. There are automatic penalties if the reporting deadline is missed.
