60 Day CGT reporting if no tax due

If no tax does it need reporting?

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My nephew and his wife (50% each)  have just (21/1/22)  sold flat to his wife's parents, flat was originally their PPR then it was let, so normal apportioning of any gain will apply.

Whilst sale was executed at £105k market value was £120k. Original cost was £107.5. There will be some legal etc costs  to claim re both purchase and sale.

Using £120k the gain is far less than their annual allowances, no other gains or losses will arise in the year.

Given no capital gains tax will be due am I correct that they do not need to submit 60 day reports?

Replies (14)

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By Wanderer
28th Jan 2022 08:35

UK residents or non residents?

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By DJKL
28th Jan 2022 09:08

Sorry, UK residents.

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Replying to DJKL:
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By Wanderer
28th Jan 2022 09:17
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By DJKL
28th Jan 2022 09:25

Thanks, I had sort of got there but given my nephew and his wife both have sensitive jobs regarding the criminal process I wanted to make absolutely sure they did not break any rules (shame neither is the PM)

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By janelm
28th Jan 2022 12:15

I had this same scenario question from a client yesterday, and I thought I agreed with the above answer here, but then I found this:
https://www.rossmartin.co.uk/private-client-a-estate-planning/capital-ga...
which seems to imply if "Do your total proceeds on capital disposals exceed four times the Annual Exemption?" that you do still need the 60 day return.

Given it is the end of Jan and I didn't have time to look into this a lot further, I advised the client might be safest to file the return as it's quite straight forward (per my non-resident client who managed to submit figures that we agreed).

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Replying to janelm:
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By Wanderer
28th Jan 2022 12:22

Finance Act 2019, Schedule 2, Part 1, Section 4(1).

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Replying to janelm:
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By fawltybasil2575
28th Jan 2022 13:07

I have followed your link to the Ross Martin article. In intending no offence to whosoever prepared that flowchart, it is unfortunately incorrect.

The words stating that a 60 day return is required should have been preceded with (eg):-

"Only where any CGT is payable on the gain".

The legislation is clear.

Basil.

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Replying to janelm:
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By Homeworker
31st Jan 2022 10:19

janelm wrote:

Given it is the end of Jan and I didn't have time to look into this a lot further, I advised the client might be safest to file the return as it's quite straight forward (per my non-resident client who managed to submit figures that we agreed).


You must be joking! The procedure for filing a 60 day CGT return is far from straightforward and if your client does not already have a PTA (as most of mine don't) there is no way he could do it in one day. I can only assume you have not dealt with any yourself yet?
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Replying to Homeworker:
By cathyne
31st Jan 2022 13:23

I have filed a number of these returns in the last few months, and I can confirm that the PTA and the Capital Gains Tax on UK property account, and Authorisation processed and the Online return Competed and submitted in 3 hours. That was yesterday

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Replying to janelm:
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By raycad
31st Jan 2022 15:50

Replying to Janelm:

With reference to the quote "Do your total proceeds on capital disposals exceed four times the Annual Exemption?", this applies only to the SA return which in your case will be the one for the tax year ending 5/4/22, so nothing to do for nigh on a year.

The in-year reporting , namely the 60 day Property Disposal Return, does, however, have a completely separate set of rules. As others have observed, a UK-resident is excused from doing one of those if there is no CGT payable (on the facts then known).

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By David Ex
28th Jan 2022 13:56

Someone helpfully posted this link a few weeks ago.

https://www.gov.uk/hmrc-internal-manuals/capital-gains-manual/cg-app18#_...

1.11 UK residents

...
There is no need to report any disposal where there is no CGT liability (although users can report such disposals voluntarily). There may be no liability for example if:

Private Residence Relief applies in full, see CG64200c
The gain is covered by the Annual Exemption, see CG18000p
The gain is covered by brought forward losses or current year losses realised prior to completion of the disposal, see part 2.5.1 of this guidance, and CG15800p for further CG guidance on losses.
A CGT Relief applies which reduces the full gain to nil, see part 2.4.4 of this guidance and CG60201c

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By chronus
31st Jan 2022 16:36

This would appear to be a connected party transaction.
Given the underlying assumption for CGT transactions to have been carried out at MV, I would raise more concern with that aspect rather than the 60 day reporting requirement which is a lot more straight forward.

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Replying to chronus:
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By DJKL
31st Jan 2022 17:42

We have a surveyor's valuation so I am happy re that aspect, it will be flagged on the tax returns anyway so if HMRC want to query the value they can.

For where it is and what it is valuation looks okay, it was purchased pre 2008 crash and could not be sold for years as was in negative equity, it has only now managed to splutter back above water (It is not in Edinburgh,

Effectively my nephew and wife have been reluctant landlords for a fair few years and had to move out when number one child came along as it is only a one bed property.

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By Martin B
24th Mar 2022 09:31

60 Day CGT reporting if no tax due

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