CGT 60 Day Property Return - Should I do it myself?

[Citizen7]

This is a long post. In short, I am asking for a second opinion on whether or not I could tackle the completion of the CGT 60 Day Return (and the ‘related’ Self Assessment return) myself or pay a tax agent to do this for me. There is an element of subjectivity about the question, but I hope it will be worth asking nonetheless.

The property in question is a BTL that I have had for many years.

I have told the selling agent that I do not wish to ‘conclude’ any sale until 6th April 2022 - in other words, not until the new tax year. This is primarily because I believe this will make life simpler for a reporting point of view. However, if I missing something here then I would be very interested to hear about it.

If I don’t complete the form myself, I will need to pay a tax agent to do so for me. I have a quotation for this work of circa £750. Perhaps this would indeed be money well spent. So I am wondering if anyone has any experience of trying to complete the form etc and then decided that paying a tax agent to do so was the better option.

I do have some tax knowledge, do my own tax return each year and, like exercise and bad medicine, would see an argument that pushing myself to do something challenging/unpleasant is good for me. On the other hand, I don’t want to get things wrong.

So, firstly, I would like to ask if there are many on here who have completed a CGT 60 Day Return…and lived to tell the tale.

Some other questions:

Supporting documentation - at time of purchase, I also ‘renovated’ the property and did some additional works, including changing it from a three bedroom to four. I don’t have the original ‘invoices’ for the labour and materials etc…but do have the invoices from the ‘property management’ company that commissioned these works on my behalf. Am I right in thinking that their invoices will be sufficient for the purposes of ‘supporting documentation’ for HMRC.

Further to the above, it would be my understanding that I would be likely to need the above only in the event of a future query/inspection from HMRC. Is that right? It will be too late then to go back to the ‘property management’ company for their original ‘labour and materials’ invoices so I feel I need to be sure I have all that is needed now.

The key point I’d like to check is that by completing a CGT 60 Day Return Form in the early part of the 2022/2023 tax year I will have the full Personal Allowance (£12,570) and 20% basic tax rate band (£37,700) to set against the gain arising. The additional gain above that £50,270 would then be taxed at 28%. Is that right?

I have been reading about setting up a ‘Property Account’ in a paper I found online from the Association of Taxation Technicians (att). It’s called ‘UK Property Reporting Service - a user’s guide (latest update 25 January 2022) and I am ‘somewhat optimistic’ I could tackle the process and reporting the gain….but then ‘no plan survives contact with the enemy’…

A further question, if I may, concerns the interaction between the CGT 60 Day Return from and the 2022/2023 Self Assessment return. The same att article reference above refers to the “possibility “that future self assessment returns will be ‘pre-populated’ with figures relating to a CGT 60 Day Property disposal where that has already happened in the tax year. That would be ideal as it seems to me that it is the interaction between the two that could be the most awkward part of the process. So, once again, I’d be very interested if anyone has any experience of or thoughts about how tricky it could be to get both the CGT 60 Day Return and subsequent Self Assessment form right.

Ok, with apologies for the length of my post and, perhaps, too much details, I’d be very grateful for any thoughts on the above - especially if I have misunderstood or got wrong any particular thing - and whether or not completing the CGT 60 day Return (and subsequent Self Assessment return) is reasonably doable or not.

Much obliged.

C7

[Loup321]

I sold a property in December, and had to complete the form and pay the tax. It was straightforward. You will need to get together the pieces of paper relating to the costs of the sale (solicitors, estate agents etc.) and the cost of the purchase (solicitors). I also needed to calculate the private residence relief, as I lived there for 3 years before renting it out. You'll need to give all that information to your advisor anyway, and once you have it all together, filling out the form is simple. Mine was harder, as it was only 50% owned by me, so I had a pen and paper, writing down the full amounts and the 50% amounts (which I passed to the co-owner so he could do his return), and doing the mental calculations as I went along.

You will need to decide how much of your CGT allowance you want to use against the gain (100% in my case, because no other chargeable disposals). You will also need to estimate your total income for the year, so the calculator can decide how much of the gain is at what rate, and then it's all calculated for you. Then you pay by card (separate form to complete, so you can do that the next day or after a cup of tea). It's the payment that must be done within 60 days.

In my case, I don't know exactly what my final income for the year will be, so I said there were estimated figures. I'll complete a tax return as normal, including the information I put on the CGT return, and hopefully (through pension contributions) the gain will all be in the Basic Rate band, so will get a little tax back. So anything that you aren't sure about, you have until the self-assessment deadline to get absolutely correct. You can also make changes to the form after you have submitted it but before you pay, just in case you remember something important (like you decide to increase your pension contributions, and hence increase the limit of one of the tax bands).

In your case, whether you do it this tax year or next may depend on whether you have other chargeable gains/losses this year or anticipate them next year.

So a heck of a lot for you to do anyway, to tell all of it to someone else for them to fill in the form. If you complete your own self-assessment, this is just as simple. And you have time to think about the correct figures, and either correct them before you pay (which must be done before the 60 day deadline) or correct them on your tax return for the year. It might be scarier than self-assessment, as you've never done it before (it was for me), but then how scary was self-assessment the first time? Now it's routine, as long as I have have all the bits of paper correctly in the filing system.

Hope that helps

LouP

[Citizen7]

Hey, big shout out to you, LouP, thanks very much for your tremendous reply.

I am still checking a few things out following your message, but am much more confident already regarding the completion of the CGT form myself…watched the YouTube video about how to do things as well.

Maybe I could come back if there are any persistent areas of confusion, but am once again most grateful for your reply in the meantime.

C7