Declaring BTL sale on tax return
Discussion
My wife and I sold our BTL back in March and are filling in the tax return/CG tax section. The house was owned 50:50, and, while there's a gain I don't believe there's CGT to pay as we lived there for half the time we owned it so are entitled to Lived In Allowance as well as Letting Relief.
What I was wondering was on the Self Assessment CGT section, do we each declare the sale price of the house, costs, relief etc as 50% (i.e. our share), or each put the 100% value?
What I was wondering was on the Self Assessment CGT section, do we each declare the sale price of the house, costs, relief etc as 50% (i.e. our share), or each put the 100% value?
When my wife and I sold one of ours in September we just split the costs and proceeds 50/50 as you suggest... but I think you're supposed to submit the return within 30 days of the sale so you may be due a fine... Also the reliefs etc have changed - there is only 9 months relief now rather than 18 or 36 months as it was before.
sociopath said:
Sold in march and not declared in last years tax return?
Tax return for 19/20 is due end of Jan. It was sold Mar 20.boyse7en said:
The first £12300 of capital gains is tax-free, double that if you are married.
But I don't think lettings relief applies any more
Thanks, it was sold Mar 2020 so I believe qualifies.But I don't think lettings relief applies any more
CharlesElliott said:
Yes, use 50% of the figures for everything. You can add a comment in the notes section saying what you have done if you wish.
The income section also asks for the name of the co-owner if I remember correctly.
Thank you!The income section also asks for the name of the co-owner if I remember correctly.
Tyndall said:
sociopath said:
Sold in march and not declared in last years tax return?
Tax return for 19/20 is due end of Jan. It was sold Mar 20.boyse7en said:
The first £12300 of capital gains is tax-free, double that if you are married.
But I don't think lettings relief applies any more
Thanks, it was sold Mar 2020 so I believe qualifies.But I don't think lettings relief applies any more
CharlesElliott said:
Yes, use 50% of the figures for everything. You can add a comment in the notes section saying what you have done if you wish.
The income section also asks for the name of the co-owner if I remember correctly.
Thank you!The income section also asks for the name of the co-owner if I remember correctly.
So much confusion.
Asset sold before 5 April 2020.
Therefore, the 30 day reporting rule DOES NOT APPLY. The rule came into effect for residential property disposals from 6 April 2020 onwards.
Letting relief is still valid as it was only discontinued from 6 April 2020. It is STILL valid if the owner was living in the property at the date of disposal.
It obviously needs to be submitted on a 2019/20 Self Assessment tax return. The deadline for submitting 2019/20 tax returns is 31 January 2021 (this coming Sunday).
31 January is also the date by which any tax amounts owed needs to be paid. Late payments attract interest after 31 January and, if left unpaid at 28 February, will also receive an additional 5% penalty surcharge.
The property was owned jointly.
This means BOTH parties needs to submit their share of the gain on their own individual self assessment tax returns - and pay their own share of the Capital Gains Tax, if any.
I presume both parties already have Self Assessment Tax references?
Asset sold before 5 April 2020.
Therefore, the 30 day reporting rule DOES NOT APPLY. The rule came into effect for residential property disposals from 6 April 2020 onwards.
Letting relief is still valid as it was only discontinued from 6 April 2020. It is STILL valid if the owner was living in the property at the date of disposal.
It obviously needs to be submitted on a 2019/20 Self Assessment tax return. The deadline for submitting 2019/20 tax returns is 31 January 2021 (this coming Sunday).
31 January is also the date by which any tax amounts owed needs to be paid. Late payments attract interest after 31 January and, if left unpaid at 28 February, will also receive an additional 5% penalty surcharge.
The property was owned jointly.
This means BOTH parties needs to submit their share of the gain on their own individual self assessment tax returns - and pay their own share of the Capital Gains Tax, if any.
I presume both parties already have Self Assessment Tax references?
Tyndall said:
sociopath said:
True, i always do my asap in cse of issues, so forget people leave it so long
Advice I'm definitely going to be taking in the future!Eric Mc said:
So much confusion.
Asset sold before 5 April 2020.
Therefore, the 30 day reporting rule DOES NOT APPLY. The rule came into effect for residential property disposals from 6 April 2020 onwards.
Letting relief is still valid as it was only discontinued from 6 April 2020. It is STILL valid if the owner was living in the property at the date of disposal.
It obviously needs to be submitted on a 2019/20 Self Assessment tax return. The deadline for submitting 2019/20 tax returns is 31 January 2021 (this coming Sunday).
31 January is also the date by which any tax amounts owed needs to be paid. Late payments attract interest after 31 January and, if left unpaid at 28 February, will also receive an additional 5% penalty surcharge.
The property was owned jointly.
This means BOTH parties needs to submit their share of the gain on their own individual self assessment tax returns - and pay their own share of the Capital Gains Tax, if any.
I presume both parties already have Self Assessment Tax references?
Excellent, thank you Eric - was hoping you'd jump in! Yes we both have Self Assessment Tax references already. Asset sold before 5 April 2020.
Therefore, the 30 day reporting rule DOES NOT APPLY. The rule came into effect for residential property disposals from 6 April 2020 onwards.
Letting relief is still valid as it was only discontinued from 6 April 2020. It is STILL valid if the owner was living in the property at the date of disposal.
It obviously needs to be submitted on a 2019/20 Self Assessment tax return. The deadline for submitting 2019/20 tax returns is 31 January 2021 (this coming Sunday).
31 January is also the date by which any tax amounts owed needs to be paid. Late payments attract interest after 31 January and, if left unpaid at 28 February, will also receive an additional 5% penalty surcharge.
The property was owned jointly.
This means BOTH parties needs to submit their share of the gain on their own individual self assessment tax returns - and pay their own share of the Capital Gains Tax, if any.
I presume both parties already have Self Assessment Tax references?
Although you've left it all rather late, if you have all the information you need to hand, there is no reason why you shouldn't be able to complete the Capital Gains Tax calculations and complete and submit the returns by midnight, Sunday.
HMRC has stated categorically that they will definitely NOT be extending the filing deadline this year, even with the problems created by Covid.
HMRC has stated categorically that they will definitely NOT be extending the filing deadline this year, even with the problems created by Covid.
Sorry all, another from me!
Are the costs we incured during the sale (conveyancing, estate agents, damp survey etc) deductible from the rental income from that year, the same way we would for say insurance or mortgage interest costs?
Edit - and the penalty for repaying the mortage before the end of the fixed period
Are the costs we incured during the sale (conveyancing, estate agents, damp survey etc) deductible from the rental income from that year, the same way we would for say insurance or mortgage interest costs?
Edit - and the penalty for repaying the mortage before the end of the fixed period
Edited by Tyndall on Monday 25th January 11:29
Tyndall said:
Yes we both have Self Assessment Tax references already.
If you're not already set up for filing online you'll need to move very fast indeed - because after first online contact they then have to send you a code in the post (yes, snail mail) before you can actually log in and file a return.rockin said:
If you're not already set up for filing online you'll need to move very fast indeed - because after first online contact they then have to send you a code in the post (yes, snail mail) before you can actually log in and file a return.
Thanks, we're all set up and file every year, it's just this year is a bit different with the disposal of asset. Only real question left is whether the fees incurred during sale are deductible against rental income for the year, the same way we would normally with other property-related costs.Tyndall said:
Sorry all, another from me!
Are the costs we incured during the sale (conveyancing, estate agents, damp survey etc) deductible from the rental income from that year, the same way we would for say insurance or mortgage interest costs?
Edit - and the penalty for repaying the mortage before the end of the fixed period
Costs involved in selling, and buying just in case you still have them, are offset against the capital gain calculation, not the rental income.Are the costs we incured during the sale (conveyancing, estate agents, damp survey etc) deductible from the rental income from that year, the same way we would for say insurance or mortgage interest costs?
Edit - and the penalty for repaying the mortage before the end of the fixed period
Edited by Tyndall on Monday 25th January 11:29
The early redemption penalty is a valid deduction against the rental income.
http://property-tax-advice.co.uk/Blog/Post/1105/ho...
Sounds like the OP should have been speaking to an accountant at some point in the past nine months - even if it was through PH 
Capital Gains are exactly what they say on the tin, gains based on the disposal of capital assets. Therefore, any costs incurred when the asset was purchased, costs incurred when the asset was sold, or any "enhancement" costs during the entire period of ownership, can be included in the calculations.
If the asset was used to generate annual revenue, such as rental income from a property, capital costs incurred during the period should NOT have been offset against the rental income. These capital costs would need to wait to be offset against any capital gain when the property was eventually disposed of.
And, as I did say earlier, the new "on line 30 day" submission system came into effect on 6 April 2020 i.e. it applies to tax years 2020/21 onwards.
Capital Gains are exactly what they say on the tin, gains based on the disposal of capital assets. Therefore, any costs incurred when the asset was purchased, costs incurred when the asset was sold, or any "enhancement" costs during the entire period of ownership, can be included in the calculations.
If the asset was used to generate annual revenue, such as rental income from a property, capital costs incurred during the period should NOT have been offset against the rental income. These capital costs would need to wait to be offset against any capital gain when the property was eventually disposed of.
And, as I did say earlier, the new "on line 30 day" submission system came into effect on 6 April 2020 i.e. it applies to tax years 2020/21 onwards.
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