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The Building Company is based in North London and covers Hertfordshire and Northern region of our capital city. We offer bespoke loft conversions, extensions & large scale refurbishments at prices to suit all budgets. We would love to hear from you and get in touch to discuss our services. We are always friendly and never use a hard sell approach.

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Are you aware of the 6th April Capital Gains Tax (CGT) changes?

Are you aware of the 6th April Capital Gains Tax (CGT) changes?

Many things may be changing around us right now, but something the global pandemic does not seem to have affected is changes to Capital Gains Tax (CGT) due to come into effect on 6 April… are you ready?

 

According to Wikipedia, a “capital gains tax (CGT) is a tax on the profit realized on the sale of a non-inventory asset. The most common capital gains are realized from the sale of stocks, bonds, precious metals, real estate, and property”.

 

So, if you own a property other than your primary residence and you decide to sell it, making a profit, then you’ll incur an 18% tax liability on the profit you made if your income is below £50k or a 28% tax liability if your income is higher (subject to a CGT allowance of £12k, or £24k if you’re married or in a civil partnership).

 

This has always been the case, with varying percentages, but the changes coming in on 6th April have nothing to do with the amount – they relate instead to when you have to pay the tax. Instead of having 10 to 22 months to settle up after the sale of the property (depending on the transaction), you’ll now need to file an online return with HMRC and pony up within just 30 days.

 

So, 1) you’ll need to set up an HMRC Gateway Account as these returns must be made online, 2) if you have an accountant or someone else who will be doing the calculations/submissions for you, they will need to be digitally authorised to do so, and 3) you’ll need to be on the ball, making your calculations and submissions quickly and accurately or fines may follow.

 

The sort of information you’ll need readily available to you will be: the date you bought the property, what you paid for it, what work you’ve done on the property and how this may have impacted on its value (you may need to ask a surveyor to provide a professional valuation of your property), and your annual income (to determine the rate of CGT you’ll be charged).

 

As I’ve mentioned above, if you live in the property, and have always done so for as long as you’ve owned it, then you will not be liable for CGT and the changes on 6th April will not affect you. But if you have rented out your property for any period then it’s important to seek the right advice before you sell to discover whether you will find yourself inadvertently liable for this tax.

 

We live in changeable times, so it’s entirely possible that the 6th April deadline will move, but – for now – it makes sense to prepare if you have a property to sell.

If you are looking to sell your home, buy-to-let property or investment, call us on 0203 021 2140 or email info@thebuildingcompany.co.uk and we’ll help you to maximise its value with all the remodelling, renovation, refurbishment, loft conversion and extension work you might need.

Lisa Wood
Lisa Wood
info@thebuildingcompany.co.uk

Coming from a very creative background, Lisa followed her passion for Art & Design and went through Art College and a BA Fashion & Textile course at University. Straight from University she landed her dream job in the fashion world, which she enjoyed being in for over 20years. Lisa decide in 2016 that she wanted to take her creative skills into another area of design joining The Building Company and concentrating on interiors.