are you thinking of selling a
residential property after the 6th of
april 20. well if so watch on because
there's some big changes
as business accountants we help business
owners and landlords all day long with
their tax affairs and their journey
and as a result these changes that are
coming or have already come by the time
you're listening to this video
in april 2020 are massive and really
important to spread the word
so before i explain the changes if you
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more videos just like this one i think
revenue and customs have
many of these things in the background
that often people aren't aware of and
this
is a big change so what happened
currently is if you're
non-resident and that's for tax purposes
sounds a bit odd but let's say you're
you've been in spain for five years
you've kept your uk property there and
as a result you've sold it
at some point and made it and made a
profit you actually have 30 days
to report online on an online return and
pay your tax now
many non-residents don't even know this
and we help people all the time that
have this problem or they suddenly find
out later they should have done this and
we get it sorted now that's been in play
for years
now the change that's happening is it's
now the case in the uk as well
so if you sell a residential property
there's some small changes but if you
sell a residential property
in the uk and you have to pay capital
gains tax on it
then you have to report it online on
this new online form and pay any tax due
now in order to know if you need to pay
any capital gains tax there is a
calculator online that would tell you
this but just to give you a rough
example really
you if you imagine if you took what
you've got for it so let's say
you got 300 grand for it and only cost
you 200 grand
you got 100 and gain any gain that's
over 12
300 pound if you've got no other
disposals in the year of anything you
haven't sold anything else like that in
the year
you're gonna have to report you're gonna
have to pay profits on so using that
example with your hundred grand profit
you take twelve thousand three hundred
pound off of your hundred grand profit
what's left is then tax to eighteen or
twenty eight percent
or a combination of the two depending on
what other income you've got
now if you google capital gains tax
rates you might find that there's
mention of 10
and 20 but don't apply unfortunately to
residential property
the tax man many years ago has started
to squeeze in
on landlords and as a result yeah these
rates these higher rates still apply so
that's the bad news but yet you do now
have to report this
very very quickly now if you haven't
made a game where you've had to pay any
tax you don't actually have to report it
and that's different from this
non-resident version if you're
non-resident you
have to report it regardless but for a
uk
taxpayer you a person resident in the uk
so just generally people who live in the
uk in the majority of situations
not always personal video you have to
report on this online
form now if you already do a tax return
you might also have to put it on the tax
return sounds weird doesn't it you're
going to report early in the year and
then you're going to report
normally later in the year now
unfortunately this is the case so
if you've made a profit on that property
you're going to need to report it in
both places you're going to need to
report it online on the form within 30
days and you're also going to need to
report it on your tax return
previously it was only a tax return
thing so you actually have ages to do it
you had up to 21 months actually to pay
the tax and often report depending on
how soon you did it so
that was a long time now cash flow wise
you've got to part with money pretty
quick so
it's worth bearing in mind and also
think if you know this is coming i'd
engage with an accountant as early as
possible because
if you've never dealt with one before
there's quite a bit of thing you need to
do just
they need to sort of uh you need to
appoint them they need to get
professional paperwork involved check
your identity a few other things to to
make sure it's all okay
and then get this form signed and get it
scheduled into their work so make sure
you give as much notice as you can that
this is coming up so that's really a key
important action point for you so going
back to the tax return it's very likely
that if you've already got a tax return
here you're going to have to
report the sale of the property on that
tax return now that's whether you made a
profit or not
there's some technical rules i won't go
into here but generally due to the value
of the property you're going to need to
put on your tax return
if you've made a loss that's actually
quite a good thing sometimes for a tax
purpose because you can do things like
that loss like offset it against other
properties you sell
or you know future future properties
things like that
the one thing to remember is we're
talking about things like buy to let
properties and the like
if you generally if you sell your house
in the uk you're going to be exempt
by something they call private residence
relief which means you know if you've
only ever lived in it and it's your main
home
you can pretty much ignore everything
i've just said it's it's going to be
completely outside the scope of this
but if you uh if you've let's say you
lived in it for a bit and then
you moved abroad and started renting it
out you're still going to have to listen
to this video and do these things we're
talking about i suppose it's worth
clarifying just for complete peace of
mind that if you do have to do this
return within 30 days as a uk
resident and then you then have to do
the tax return obviously they're not
going to tax you twice but it's just
worth bearing in mind that there are two
reporting things that you have to do so
if you are selling a residential
property after the 6th of april 2020
make sure you're aware of these rules
and if you're in those kind of groups
where there's other landlords and people
please do share this information with
them because it's a really critical
piece and of course
with any form that's going to be late
with revenue customs there are penalties
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