Help with a tax question please
Discussion
Hello, any help would be appreciated on this question...
If I receive a payment subject to capital gains tax for selling land, when does the tax become due? I believe residential property tax is due within 6 months of completion, but not greenfield land?
At present I believe cgt is 20%, but there is much talk of a possible Labour government from Dec 24 / Jan 25, and an increase in cgt to 40%.
Assuming that to come true, what would be the latest I could receive payment, declare it to HMRC, and pay at the lower rate of 20%?
My thinking is that if a payment was received on or after 6th April 2024 (which will be declared to HMRC on the 6th April 2025 tax return) would it be charged at 2024 taxation levels (20%) because that's when the payment was received, or would it be charged at 2025 taxation levels (40%)?
Do payments received have to be declared in this drawn out way, or could you pay the due cgt early to avoid the suspected huge hike?
Thanks!
If I receive a payment subject to capital gains tax for selling land, when does the tax become due? I believe residential property tax is due within 6 months of completion, but not greenfield land?
At present I believe cgt is 20%, but there is much talk of a possible Labour government from Dec 24 / Jan 25, and an increase in cgt to 40%.
Assuming that to come true, what would be the latest I could receive payment, declare it to HMRC, and pay at the lower rate of 20%?
My thinking is that if a payment was received on or after 6th April 2024 (which will be declared to HMRC on the 6th April 2025 tax return) would it be charged at 2024 taxation levels (20%) because that's when the payment was received, or would it be charged at 2025 taxation levels (40%)?
Do payments received have to be declared in this drawn out way, or could you pay the due cgt early to avoid the suspected huge hike?
Thanks!
https://www.gov.uk/hmrc-internal-manuals/capital-g...
Double check as I'm not an expert. It was what I was told when considering the sale of a business
Double check as I'm not an expert. It was what I was told when considering the sale of a business
This.
If you sell a business on 6th April vs. 5th April, you’ll won’t have to pay the CGT due until 31 Jan in the following tax year so potentially 21 months (vs. 9 months later) so v. important that you don’t overlook this and get caught short when the bill
Is due…
And my understanding is that if the deal was structured as an earn out, the tax due will be assessed as at completion (based on estimates/projections) and will stick, even though you never receive the assessed value if the transaction underperforms…
If you sell a business on 6th April vs. 5th April, you’ll won’t have to pay the CGT due until 31 Jan in the following tax year so potentially 21 months (vs. 9 months later) so v. important that you don’t overlook this and get caught short when the bill
Is due…
And my understanding is that if the deal was structured as an earn out, the tax due will be assessed as at completion (based on estimates/projections) and will stick, even though you never receive the assessed value if the transaction underperforms…
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