CGT 60 Day Property Return - Should I do it myself?
Posted: February 20th, 2022, 1:16 pm
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
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