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New rules on Capital Gains Tax from April 6th 2020

New rules from HMRC on capital gains tax are due to take effect from April 6th 2020. These will ultimately be impacting buy-to-let landlords and second homeowners in the UK, who are selling properties that are not listed as their principal home residence. It also might mean that they could be making CGT payments much sooner than they expected to.

What rules are changing?

From April 6th 2020, the central change on CGT is that people selling their properties will need to pay the full amount owed within a designated period of 30 days, from completion day of the sale, rather than the current rule of paying by means of a self-assessment tax return the following year. The new time frame will need to be taken into consideration by property investors and landlords within the UK, that are selling on for profit.

Another relevant applicable rule change to this group of people to be aware of is that the ‘tax relief period’ allowed against capital gains tax will be reduced. As the rules stand currently, if you are selling a property that has been your main residency in the past, you will qualify for tax relief for the last 18 months of ownership. However, from April 6th 2020, unless you share an occupancy of the property, the 18-month relief period will be significantly reduced to 9 months.

As failure to pay within the 30-day limit will lead to penalties, it is expected that this could potentially create cash-flow problems for people that are selling and completing on properties from April 6th 2020. This is due to significant increases in CGT payable on those sales. There are certain exceptions and deductions on the costs of your own CGT that you will pay, which are not expected to change, such as solicitor fees, home improvement costs, surveyor fees, estate agent fees and stamp duty.

If you are unsure of how the changes will directly affect you, it is vital that you seek professional assistance from a specialist in non-resident tax affairs. We can assist you by introducing you to a tax specialist from our network who will ensure that you are paying the correct amount of tax.

Your free tax consultation will include

  • Answer any questions you have about Capital Gains Tax
  • Review your current tax situation
  • Discuss how the new Capital Gains Tax rules may affect you
  • Offer advice on your next course of action

Apply now for your free tax consultation

Complete the form to apply for your free tax consultation with a qualified tax adviser who will be able to help you:

  • Understand the fundamentals of the new Capital Gains Tax rules for UK non-residents
  • Calculate possible capital gains tax owed, incorporating any tax relief
  • Mitigate future capital gains tax through appropriate asset management
  • Discover the offshore investment vehicles which could help you protect and grow your assets
  • Reduce your exposure to all types of UK taxation
  • Plan your estate to avoid potential inheritance tax
New rules on Capital Gains Tax from April 6th 2020

Apply now for your free capital gains tax consultation

If you have property or any other assets in the UK and would like to speak to a capital gains tax expert to discuss what the new rules mean for you, simply enter your details below and we will arrange for one of our advisers to contact you