Accounting

CGT tax returns Disposals Falling Outside the Scope of the 60-Day Capital Gains Tax (CGT) Return

An In-depth Guide to Exclusions and Exceptions

Introduction

The 60-day Capital Gains Tax (CGT) return is an important requirement for individuals and trustees who dispose of UK residential property and realise a taxable gain. However, not all disposals are subject to this rule. Understanding which types of disposals fall outside the scope of the 60-day CGT return is essential for accurate tax compliance. This guide explores the various disposals that do not require a 60-day CGT return, providing clarity for property owners, investors, and advisors. Do need help in the CGT area? Our experienced Accountant in Hackney can support you with our professional services. Get in touch for more.

Overview of the 60-Day CGT Return Requirement

Since 6 April 2020, UK residents (and since 6 April 2019 for non-residents) disposing of UK residential property and realising a gain on which tax is due are required to report the disposal and pay any CGT within 60 days of completion. The rule aims to accelerate the reporting and payment of CGT on property transactions, but there are clear exceptions and exclusions.

Disposals That Fall Outside the Scope of the 60-Day CGT Return

1.  Disposals Where No Tax Is Payable
   If, after applying all relevant exemptions, reliefs, and allowable costs, there is no CGT to pay on the disposal, a 60-day return is not required. Common examples include:
   • The gain is fully covered by the Annual Exempt Amount (AEA).
   • Private Residence Relief covers the full gain.
   • Other reliefs (e.g., lettings relief, spouse or civil partner transfers) reduce the gain to nil.
2. Disposals of Non-Residential Property or Land
   The 60-day CGT return rules apply only to disposals of UK residential property or land. Disposals exclusively of commercial or non-residential property, such as:
   • Shops, offices, factories, or warehouses
   • Agricultural land with no residential component
   • Forestry or woodland property
   do not require a 60-day return.
3. Disposals by Companies
   Companies are subject to Corporation Tax rather than CGT and report disposals through their company tax returns. The 60-day CGT return rule applies only to individuals, trustees, and personal representatives, not to companies or other entities.
4. Disposals Involving Non-UK Residential Property
   The 60-day rule applies only to UK land and property. Disposals of properties located outside the UK are not within the scope of the UK’s 60-day CGT return.
5. Disposals Reported in Self Assessment (in Specific Circumstances)
   Although the 60-day return is required even if the disposal will be reported on a Self Assessment tax return, there are specific situations (mainly for non-residents) where reporting through Self Assessment alone may suffice, particularly where there is no tax due or the disposal is of assets other than UK land or property.
6. Disposals of Assets Other Than Land or Property
   The 60-day rule is focused solely on UK residential property and land. Other chargeable assets, such as:
   • Shares and securities
   • Personal possessions (chattels)
   • Business assets (unless involving UK residential property)
   do not require a 60-day return when disposed of.
7. Transfers Between Spouses or Civil Partners
   Transfers of assets between spouses or civil partners who are living together are generally not subject to CGT. These transactions are considered “no gain/no loss” for tax purposes and do not trigger a 60-day return requirement.
8. Disposals Made by Charities
   Charities are generally exempt from CGT on the sale or disposal of property provided the gains are used for charitable purposes. As such, charities do not need to file a 60-day return for such disposals.
9. Gifts to Charity
   If property is donated to a registered charity, the disposal is generally exempt from CGT and falls outside the 60-day return scope.
10. Disposals Subject to Other Exemptions
    Other specific exemptions, such as gains realised by certain pension schemes, government departments, or local authorities, will fall outside the requirement.

Key Practical Examples

• Private Residence Sale: A homeowner sells their only residence, which has always been their main home. The gain is fully covered by Private Residence Relief — no 60-day CGT return is needed.
• Commercial Property Disposal: An individual sells a warehouse used for business purposes — no 60-day CGT return required.

If you need assistance working out CGT or need any professional accounting assistance, our experienced Accountant in Hackney can support you with our professional services. Get in touch for more.

Now that MTD for Vat has become accepted HMRC are moving on to Income tax. The aim is to reduce errors and modernise the tax system. The hope is also to reduce the tax gap. For those unsure about how to cope with these changes, a trusted Hackney Accountant can help you plan ahead and minimise the tax burden.

This effects individual tax payers not companies and does not include dividends..
There seems to be no consideration of the costs effect on taxpayers. Comments have been made to the effect that HMRC might like to eventually tie this in to tax payments.

New Tax Rules 2026

New rules from April 26 will affect all taxpayers with gross turnover over £50,000 reducing to £30,000 in 27 and £20,000 in 28.
Sole traders and landlords (including foreign property income) will be covered. The gross revenue issue makes a clear defining point.
Other income will still be covered by the standard self-assessment form.

What are the exclusions?

There are exclusions:
1. Trusts and Estates
2. Registered pension schemes
3. Non-resident companies
4. Individuals with no national insurance numbers
5. Foster carers
6. The digitally excluding including the elderly, disability, religion etc.

Taxpayer Requirements

Taxpayer must keep digital records of revenue and expenses. Spreadsheets will be allowed using bridging software.
They must submit quarterly updates to HMRC through HMRC approved software.
Submit a final declaration by 31st January after the tax year end. This will replace the traditional tax return. At this point tax adjustments should be included.

What’s involved

The quarterly updates will include revenue and expenses similar to the current tax return. No tax adjustments will be included.

Deadlines are the 7th of the month 1 month after the period covered. Ie for a period to 30th June the return would need to be submitted by 7th August.

Important points to note

The £50,000 does not include salary income.
Spreadsheets can still be used with bridging software,
There will be penalties for late submission.
The Threshold is for the taxpayer’s total income, not per business.

If you’re a taxpayer and need help in the upcoming tax changes an experienced Accountant in Hackney such as us can support you with our professional services. Get in touch for more.

Understanding Inheritance Tax (IHT): What Every Hackney Resident Should Know

Inheritance Tax (IHT) has a nasty habit of creeping up on families just when they least expect it. Whether you’re single, in a long-term relationship, married, or in a civil partnership, it’s crucial to understand how your decisions today could impact your estate tomorrow. If your estate is worth more than £325,000, you should be thinking seriously about IHT implications. For those unsure about where to start, a trusted Hackney Accountant can help you plan ahead and minimise the tax burden.

When Gifts Become Tax Traps

A recent case we came across involved a young man who transferred ownership of his property to his partner. This type of transfer is known as a “Potentially Exempt Transfer” (PET). A year later, they got married — and sadly, he passed away just a year after that.

Despite the marriage, the timing of the gift meant the estate was still liable for Inheritance Tax. Why? Because the donor did not survive the required seven-year window from the date the gift was made. If he had waited until after the marriage to transfer the property, the gift would have qualified for a spouse exemption — and no IHT would be payable.

This example serves as a strong reminder: even long-term partners can face unexpected tax charges if proper planning isn’t done in advance.

Insurance as a Safety Net

One often-overlooked solution is taking out a life insurance policy specifically to cover any potential IHT liability arising from a gift. This can provide peace of mind during the seven-year period and protect your loved ones from an unexpected financial hit.

Joint Tenancy: A Hidden Risk

If you own property with someone else as joint tenants, you both have equal rights. Upon one partner’s death, their share automatically transfers to the surviving owner. But here’s the catch: even though the ownership passes on, the survivor may still face an IHT charge based on the value of the deceased partner’s share.

This situation is especially common among cohabiting couples and family members who jointly own homes but don’t realise how inheritance tax applies to such arrangements.

Civil Partnerships vs. Living Together

Being in a civil partnership offers legal protection similar to marriage — including full exemption from IHT on assets passed between civil partners. On the other hand, simply living together (no matter how long) does not provide any IHT exemption.

This means that even if you’ve shared a home and finances for decades, if you’re not married or in a civil partnership, your partner could face a significant tax bill if you pass away. It’s a painful and avoidable outcome that proper planning can prevent.

What Happens When There’s No Will?

If someone dies without a will, the rules of intestacy apply. A surviving spouse or civil partner is entitled to:

• All personal possessions
• The first £322,000 of the estate
• Half of the remaining estate

The remaining balance is shared equally among children and other direct descendants. However, this distribution might not reflect your personal wishes — another reason why estate planning is so important.

Plan Ahead with Professional Guidance

Inheritance Tax isn’t just a concern for the wealthy — it can affect anyone who owns a home, has savings, or wishes to leave something behind for their loved ones. From gifting strategies to insurance planning and will drafting, every detail matters.

Whether you’re in a relationship, cohabiting, or managing property jointly, working with an experienced Accountant in Hackney ensures you’re not leaving your estate vulnerable to unnecessary tax liabilities. Don’t wait for a wake-up call — start planning today.

Understanding National Insurance Changes for 2024–25

Discover the key National Insurance changes for 2024–25 and how they affect company directors and small businesses. Get expert advice from a trusted Hackney Accountant. With the advent of the new tax year, the widely used method of extracting profits from a company using a basic salary topped up by dividends has been revised. These changes may seem subtle at first glance but can have a meaningful impact on limited company directors and small business owners. If you’re navigating these updates, your local Hackney Accountant can help ensure your approach remains tax-efficient.

What Has Changed?

The government has introduced two important updates to National Insurance (NI) thresholds for 2024–25:

• The Secondary Threshold has been reduced from £758 per month to £417 per month. This is the point at which employers must start paying NI contributions on employees’ salaries.
• The Lower Earnings Limit has increased from £533 to £542 per month. This threshold determines whether an individual earns enough to receive NI credits toward their state pension.

Last year, directors could draw a monthly salary of up to £758 without paying any National Insurance while still earning credits toward their pension — a popular strategy for many small business owners.

This year, however, to secure NI credits, a director must now take a minimum salary of £542. Since this is above the new secondary threshold of £417, employers will now be liable for NI contributions of 15% on the difference — an additional cost of approximately £18.75 per month.

National Insurance Changes for 2024–2025- What This Means for Directors

While £18.75 per month may not seem like a deal-breaker, over the course of a year it totals £225. For a small business, this could influence decisions around payroll structures and profit extraction strategies. Directors must now weigh the benefits of receiving NI credits against the added employer costs — especially when planning dividend distributions or assessing tax liabilities.

It may also prompt some business owners to consider whether maintaining a minimal salary is still the most efficient route or whether alternative structures — such as increasing pension contributions or exploring employee benefit schemes — might offer better long-term advantages.

Seek Tailored Advice to Stay Ahead

Given these subtle yet impactful changes, it’s important not to take a one-size-fits-all approach. What works for one business may not work for another, especially when dealing with personal tax thresholds, family income splitting, and dividend planning.

If you’re unsure how these NI updates affect your financial planning, don’t leave it to chance. A qualified Accountant in Hackney can help you assess your options and stay fully compliant while maximising your take-home income. The right strategy now can save you hundreds — if not thousands — over the year ahead.

Over the last few years, the tax climate for owner managers has changed considerably. I have often been asked if it is better to receive a salary/bonus or a dividend. Bear in mind that companies pay tax at 19/25% and dividends are paid after deduction of company tax and tax on a dividend is in addition to corporation tax.

The effective tax rate for a basic tax rate dividend is 27.75% (8.75+19) rising to 64.35% (39.35+25).
Personal; tax is 20% at the basic rate and rises to 40 and then 45%.
National insurance is:
Employers 13.8% but is allowable against company profits.
Employees 8% up to £50,270 then 2%

Back in 2016/2017 dividend allowance was £5,000.
In 2018/19 this fell to £2,000
In 2023/24 it fell again to £1,000
And in 2024/25 to £500

No tax is payable on dividends within the dividend allowance.

How dividends are taxed:

8.75% if total income falls below the basic rate of £50,270
33.75 if total income exceeds £50,270 and below £125,140
39.35 if total income exceeds 125,140
Remember personal allowance diminishes after £100,000 and is Nil after £125,140.

Ignoring personal allowance and employers NI of 13.8%, the rough comparisons are
Dividend Salary
Basic27.75%28%.
In between33.75%42%
Higher rate64.35%47%

Need more information or looking to get help from your local hackney accountants? Get in touch with us and we’ll be glad to assist.

Looking for information regarding IR35? Before April 6th 2017 Personal Service Companies were responsible for deciding if they were caught by IR35. As specialised Hackney accountants, we’ve gathered the following.

From April 6th 2017 the responsibility for assessing personal service companies for IR35 was moved to Public Bodies from the personal service company.

From 6th April 2020 medium and large companies will now take on this role and review the personal service companies that they contract to decide if they are caught by IR35.

To date the accuracy of the decisions made by the Public Sector is questionable. Will this improve with the private sector given the time pressures and lack of expertise involved?

If trading through a company whether you have been deemed by a Government department to fall under IR35, or you are making the decision yourself as the contracted company there are four main tests to consider:

• Control.
• Mutuality of Obligation (Can work be turned down).
• Can a substitute be supplied?
• Do you have Insurance.

The more tests that are passed the stronger the case for not being caught by IR35.

Even if you are not facing an arbitrary decision by the employing company, HMRC is and has been reviewing small companies with IR35 in mind for a considerable time.

For those companies and people caught up in this, the situation can be both traumatic and expensive. The case of Christa Ackroyd has made headlines because of her high profile and the amounts of tax claimed. In her case the Press says she was advised by the BBC to set up a company.

We understand that recently HMRC has stepped up its activity in the IR 35 area leading to more investigations and cases.

It appears that the television industry has been targeted and they are moving on to the Dental Industry.

Need more information or looking to get help from your local hackney accountants? Get in touch with us and we’ll be glad to assist.

Just a quick reminder that from 6th April 2020 the payment window for Capital Gains Tax or CGT on Rental Domestic Properties, Second Homes and Overseas Houses and Flats will drastically shorten. As specialised Hackney accountants, we’ve gathered the following.

As of now gains are declared on the self-assessment tax return and paid the following January.

From 6th April 2020 CGT must be paid within 30 days of completion. This will mean, apart from the effect on cash flow, that a return will have to be submitted for every property sold. No return will be necessary if no tax is due.

Micro Entrepreneurs Relief

This came into effect on 6th April 2017 and is an exempt allowance of £1,000 against trading income.

For example, if John earns £1,000 on a side-line with little or no expenses (less than £1,000) he can claim expense of £1,000 making no profit.

If the gross receipts are in excess of £1,000 the he can claim Partial relief. Again, for example, If he earns £2,500 with say £500 expenses he would have an actual profit of £2,000.

However, if using Entrepreneurs relief, he can claim Partial Relief of £1,000 giving him a taxable profit £1,500.

Need more information or looking to get help from your local hackney accountants? Get in touch with us and we’ll be glad to assist.

Residential Landlords need to be aware of the changing rules with regards to the treatment of Interest on loans for Residential properties. As specialised Hackney accountants, we’ve gathered the following.

Up until 5 April 2016 Interest on loans for Residential properties could be offset against the Rental income of Residential properties in the same way as any other expense.
In 2016/2017 tax year the Government changed the rules for offsetting interest on Interest on loans for Residential properties against Income.

Gradually over the next 4 years the amount of the interest that can be offset will reduce by 25% a year.

The disallowed element in

• 2016/2017 will be 25%,
• 2017/2018 will be 50%
• 2018/2019 will be 75%
• 2019/2020 will be 100%

The disallowed element will be allowed to be offset against the tax liability as a tax reducer at a rate of 20%.

This will clearly affect people on 40% or more tax rates as well as pushing more people into the higher tax rates.

Furthermore, the higher taxable income could have implications if claiming benefits.

Need more information or looking to get help from your local hackney accountants? Get in touch with us and we’ll be glad to assist.