CGT 60-Day Returns: What UK Residential Property Owners Need to Know

If you've recently sold or are planning to sell a UK residential property, it's essential to understand your obligations under the 60-day Capital Gains Tax (CGT) reporting rule. This regulation, introduced by HMRC, applies to both UK and non-UK residents and has been a source of confusion since its launch.

At Lawrence Grant Chartered Accountants, we guide clients through the full CGT process—from calculation to timely submission—ensuring they stay compliant and avoid unnecessary fines.
For recent insights on this topic, read our hot topic update on the CGT trap.

What Is the CGT 60-Day Reporting Rule?

Since 27 October 2021, anyone who makes a taxable gain on the sale of a UK residential property must report and pay the associated CGT within 60 days of completion. This applies if:

• You sell a second home or rental property
• The sale does not qualify for full Private Residence Relief (PRR)
• You are a UK or non-UK resident disposing of UK property

Prior to October 2021, the deadline was only 30 days, which was extended to 60 to give taxpayers more time—but awareness remains low, and penalties are still common.

Who Needs to File a CGT 60-Day Return?

This rule is relevant if you're:

• A UK resident selling a residential property with taxable gain
• A non-UK resident disposing of any UK property, residential or commercial, regardless of gain

If you're not liable for CGT—for example, the sale is fully covered by PRR or falls within the annual exemption—you may not need to file. However, it's always best to verify your position with a tax professional.

You can also review how CGT works on other assets like antiques or valuables on our Capital Gains Tax on Disposal of Chattels page.

What Happens If You Miss the Deadline?

Late filing can result in:

• £100 fixed penalty if the return is even one day late
• Further penalties if it's over 3 or 6 months
• Interest charges on unpaid tax

These penalties apply even if no CGT is due, as HMRC requires timely reporting regardless of the final tax liability.

For a real-world look at the pitfalls, don't miss our feature on the CGT trap and why many sellers get caught.

How Is Capital Gains Tax Calculated?

To work out your CGT liability, you must calculate:

• Sale proceeds (net of selling costs)
• Deduct allowable costs (e.g., purchase price, legal fees, stamp duty, improvements)
• Apply reliefs (like Private Residence Relief or Lettings Relief, if applicable)
• Apply the CGT rates
• 18% for basic rate taxpayers
• 24% for higher/additional rate taxpayers on residential property gains

Remember, each individual also gets an annual exempt amount (£3,000 for 2024/25).

How to File a CGT Return with HMRC?

You'll need to:

Step 1: Create a Capital Gains Tax UK Property Account

Before you can report the gain, you need to create a CGT UK Property Account on HMRC's portal.

What you need:

• A Government Gateway ID (you can create one during the process if you don't already have it)
• Your National Insurance number
• Details of the property and disposal
• A valid email address

Where to go: Visit: www.gov.uk/report-and-pay-your-capital-gains-tax

Tip: This is separate from your regular Self Assessment login. Make sure you register for the CGT-specific service.

Step 2: Gather All Required Information

You will need to provide a number of details and documents before starting the filing process.

Key information includes:

• Address of the property sold
• Date of exchange and completion
• Purchase price and date of purchase
• Selling price (or market value if sold to a connected party)
• Associated costs (solicitor fees, stamp duty, estate agent fees, etc.)
• Improvements made to the property (not repairs)
• Any reliefs or exemptions being claimed (e.g., Private Residence Relief or Letting Relief)

Refer to our Capital Gains Tax guide on chattels and assets for info on allowable costs and gains.

Step 3: Calculate the Gain and Tax Payable

You must calculate the capital gain as follows:

Calculation Formula:

Sale proceeds – (Purchase price + Allowable costs + Improvements) = Capital Gain

Then, deduct any:

• Annual exempt amount (£3,000 for individuals in 2024/25)
• Applicable reliefs (e.g. PRR, Letting Relief)

Finally, apply the appropriate tax rate:

• 18% if within the basic income tax band
• 24% if within higher/additional rate band

Note: Estimate your income for the tax year to determine which CGT band applies.

Step 4: Submit the 60-Day Return via the Online Portal

Once your CGT UK Property Account is set up and your calculations are ready, you can log in and submit the return.

What happens next:

• Enter all disposal details step by step
• Include your estimated capital gain and tax payable
• Confirm the final figure and submit your return

Important: If you're submitting multiple property disposals, you'll need to file a separate return for each.

Step 5: Pay the Tax Owed Within 60 Days

Once your return is submitted, HMRC will provide a payment reference number.

 How to pay:

• Bank transfer (faster payments or CHAPS)
• Debit card via HMRC's online system
• By BACS from a UK bank account

Payment deadline:

The tax owed must be paid within 60 days of the completion date—not the date of submission.
Penalties apply for both late submission and late payment.

Step 6: Include the Gain in Your Self Assessment (If Required)

Even after filing the 60-day return, if you're registered for Self Assessment, you must still:

• Declare the gain again in your annual tax return (SA108)
• Reference the amount already paid via the CGT return

This ensures your full income picture is captured and reconciled with HMRC systems.
At Lawrence Grant, we handle the entire submission process for clients, ensuring accuracy and compliance.

Common Mistakes to Avoid

Here are some typical errors we see:

• Misunderstanding Private Residence Relief rules
• Failing to factor in improvement costs correctly
• Using incorrect CGT rates
• Missing the deadline due to lack of awareness
• Not considering joint ownership implications

CGT Planning for Property Owners

Strategic tax planning can help reduce or even eliminate your CGT liability. Here's how:

• Timing your sale to fall across tax years
• Transferring assets to a spouse to use both annual exemptions
• Utilising capital losses from other investments
• Considering the ownership structure (personal vs. limited company)

How Lawrence Grant Can Help?

Our tax experts offer end-to-end support with CGT 60-day returns:

• Confirming if a CGT return is required
• Calculating the gain and tax due
• Submitting returns to HMRC within the 60-day timeframe
• Advising on reliefs and exemptions
• Planning future property disposals to minimise tax exposure

We also provide full support for non-UK residents navigating UK property taxation rules.

Conclusion

The 60-day CGT reporting rule is here to stay—and non-compliance can be costly. Whether you're a landlord, property developer, or investor, understanding your obligations is vital. Let Lawrence Grant Chartered Accountants help you file on time, reduce your liability, and avoid penalties.

If you've sold a property or plan to in the near future, get in touch with us for expert guidance on your CGT return.