Report CGT on UK property – paper forms introduced

As you may know, the rules regarding Capital Gains Tax on UK property have changed in recent years. Currently, if you sell a property that’s not your main home, you need to report CGT and pay it in full within 60 days.

In most cases, people use the government’s online service to report CGT. However, in some instances, the online system is not suitable. This has caused problems for some taxpayers. In order to complete their CGT return, they’ve had to ring HMRC to request a paper form.

Doing this sounds simple, but it often isn’t. Thanks to the pandemic and the rise of home working, call wait times can be substantial. In addition, you then have to wait for the paper form to reach you. If you’re lucky, it’ll take a couple of days or so. If you’re not, there may be yet another Royal Mail strike.

Campaign for paper forms

Many people in the accountancy industry have been frustrated that they can’t simply download a CGT form. As a result, organisations such as the Association of Tax Technicians (ATT) lobbied HMRC for downloadable forms.

Industry pressure finally seems to have worked. HMRC has now published downloadable forms. You can use these to report CGT on property, but only in certain circumstances.

When can I report CGT using a paper form?

HMRC has laid down strict guidelines that determine whether or not you should submit a paper return. If you report CGT on your own behalf, you should use a paper form if you:

• Are a digitally excluded taxpayer or you are unable to pass HMRC’s verification process
• Have already submitted a Self-Assessment Tax Return for the same year as your CGT report
• Are a corporate trustee
• Are a secure or Public Department 1 customer who doesn’t file online returns
• Are a non-resident trustee who does not have any non-resident CGT liability to pay

In addition, an agent (such as your accountant) can use a paper form if they are dealing only with your CGT reporting.

There are other circumstances when you can use a paper form. If you are acting for someone else (for example, as an appointee or as someone with lasting power of attorney), you should use a paper form if you:

• Want an agent to report CGT on your behalf
• Need to amend a CGT report you’ve already submitted online

Finally, if you’re a personal representative (i.e. an executor or administrator of someone’s Will), you should use the paper form in these circumstances:

• When you want to use a different agent to deal with the deceased’s estate that the agent who deals with your individual tax affairs
• When you need to amend a CGT report you’ve submitted online

How do I report CGT on UK property using the paper form?

If you do need to use the paper form, you need to download and print a copy from this page. After you’ve filled in the form, you should send it to the address printed on the first page.

On receiving your form, HMRC will send you a 14-digit reference number. You’ll need this to pay any CGT you owe. You can pay online, via bank transfer or by cheque. HMRC provides full details of ways to pay here.

I need help to report CGT. What do I do?

If you need help to report CGT, talk to us. We offer a fast-track, 48-hour CGT reporting service. This helps you to ensure that your return is completed correctly and that you don’t fall foul of penalties and interest. In addition, if you give us enough notice, we may also be able to find legitimate ways of reducing your tax bill!