What is Real Time Capital Gains Declaration ?

Capital Gains Tax declaration is when you report your gains from the sale of a property via the Real-time CGT reporting system or a Self assessment Tax Return, depending on your situation. When individuals do sale a property, they might forget they have to report their gains but the error can be costly with the possibility of facing penalties. 

When do You have to do this declaration ?

Capital Gains Tax declaration applies for self assessment, individuals, trustees, partnership, limited liability partnerships and joint owners of property. If you are a UK resident, then you will 60 days from the date of completion to report your gains. Although, as a resident, you will not need to do this declaration if you don’t have any tax to pay and you can wait to include the sale in your Self Assessment. 

However, if you are a non-resident, then you will have to report the sale of the property, whether or not you will have any tax due on the sale. In any circumstance, you will have 60 days from the date of completion to report your sale to avoid any unwanted penalties. 

What are the penalties ? 

Depending on how late you are in the deadlines to report your gains and to pay your tax due, the penalties will go up. It starts off with a fixed penalty of £100 per return for missing the deadline and then it will be followed with a daily penalty of £10 for the next 90 days. If you are 6 months late, it will be 5% of tax due or £300 penalty, depending on what is greater. From 12 months of being late to file the declaration, the penalty is dependent on behaviour and deliberately withholding information from HMRC. 

If it is deliberate and concealed withholding information, then the penalty will be 100% of tax due or £300 if greater. But if it is not concealed, then it will be 70% of tax due or £300 if greater. For being late for payment of tax due, then the penalties will be 5% of tax due for 30 days, 5% of tax outstanding for 6 months and 5% of tax outstanding for 12 months.

If you need any help with reporting Real Time Capital Gains, then you can contact us right away.