Has anyone done their own CGT return? Advice please

[beachreader]

Have recently sold our rental property so need to pay our capital gains tax. I’ve always done our annual self assessments (for me and parter as it was a shared property) successfully but wondering of we need to use an accountant?
We lived in it for 7 years and rented it for 6 years so understand we only pay CGT on the proportion of time it was a rental property.
We don’t have lots to offset (an extension and the new kitchen and bathroom we put in will be all) but it seems that the advice is always to use an accountant.
Just be interested to hear from anyone who has done it themselves, is it a similar process to self assessment in that we input the info and it calculates what we owe which we then pay?
I can’t see an accountant being able to save us much vs the £4/500 fees for an accountant.
Would appreciate any experience or info.

Thank you

Set up a Residential property capital gains account online with HMRC (it's very easy) then just answer the questions, it talks you through it and tells you how much to pay at the end.

Make sure you get it done and paid within 60 days of completion and make sure you claim estate agent fees and solicitor fees as expenses of sale and any capital improvements can be claimed as well so things like extensions etc not repairs or replacing windows etc.

Oh you also get the last 9 months of ownership as PPR relief as well as the time you lived in it.

Thank you so much. I did actually have the estate agent fees and solicitors fees on my list of things too.
Do I manually discount the last 9 months or is that calculated automatically?
Really appreciate your reply x

You have to calculate the PPR yourself but it's pretty easy. Just add the 9 months to the period of occupation for your calculation.

https://www.gov.uk/government/publications/private-residence-relief-hs283-self-assessment-helpsheet/hs283-private-residence-relief-2022

Just be aware that kitchen and bathroom replacements are not necessarily capital improvements as far as HMRC are concerned…their default position is likely to be that any replacement was in fact a repair. And if all you you did was replace like-for-like they would be right. If you fitted a kitchen or bathroom of superior quality (which means relative to the quality when the original was installed, not the fact the replacement is more modern) then they would see that as an improvement. But you need to be able to document that.

I am a qualified accountant, but I still use an tax expert for my tax returns, as I have no interest in keeping up to date with the latest tax rules!

Sorry just realized that link isn't that helpful as it goes into quite a bit of detail on things that aren't relevant for you. This is probably better:

PRR Relief = ( Time Lived + Last 9 Months ) / Total Ownership × Capital Gain

You are best calculating period of ownership and period of occupancy (including last 9 months) in days. It seems a pain but you can Google "how many days between x and y date so its not that bad.

You need to manually calculate the Private residents relief.
We were quite particular about this and did it based on days.
There is a link to explain how to do that
Basicaly i

Gain in ££ x ( days living in property + last nine months / total ownership in days ) = PRR

[ don’t forget leap years….every little helps as they say ]

You put in all the costs including legals to buy and sell plus estate agents.
Plus any upgrade costs like your extendion. Include evidence of these like builders invoices, copies from you bank statement showing payments

The amount you owe is automatically calculated
You then load up evidence of costs.

Evidence of when you move out is also required ie council tax bill for other property,

It’s very very simple
We have never used an accountant.

You have 60 days from the sale date

I put it through an accountant, who in fairness literally talked me through the HMRC online form, (via email, we never met) however, she was well worth the £300 fee as saved me a lot of money through her greater understanding of the rules.

Slightly different situation but we recently (last September) sold a rental property to a family member so needed to pay our capital gains tax. Like you we had always done our own annual self assessments and therefore decided to do it ourselves rather than use an accountant. However, we had never lived in the property so I think it was more straightforward.

I must complete on average a CGT return once a week and have never provided or been asked for proof of date of move out.

Basically OP what you need is

Completion Statement from purchase (if you can't find it anymore ask solicitors for a copy)

Purchase price

Cost of Solicitors for purchase

Cost of any capital improvements so the extension definitely. Shakier ground with kitchen and bathroom unless they were a significant upgrade and that doesn't just mean old version replaced with modern version. So did you put downstairs toilet in when there wasn't one before? Do you now have 12 cupboards an integrated dishwasher and an island when you just used to have 9 cupboards for example.

Completion Statement from sale

Cost of Estate Agent for sale

Cost of solicitor for sale

Work out PPR relief

Work out if you have any prior capital losses you can use (I'm going to assume not unless you have previously sold a property for a loss most people don't)

Split everything in half etc if joint owners

Apply the £3000 annual exempt amount

Job done.

Honestly the system talks you through it but if you do get stuck part way you can always get a tax adviser (not an accountant) to take over or even just help you with one particular bit

Thank you so much for all of your replies, a final question if anyone is able to help; do I need to upload all of the documents and invoices with the return or do I input the figures and wait to be asked for the proof of costs etc? When I do my self assessment I just put the amounts in, I have never been asked for receipts etc?

Once again thank you, I will give it a go this week.

I’m good at this stuff and found it immensely complicated (probably because I initially bought the home with someone and later bought them out). I paid an account about £600 to do it.

Properties we’ve lived in and then moved out of for a while always require some evidence of occupation period.
Nothing more than council tax bills, voting register for example has been required.
Hmrc have always asked for proof from us.

Properties that we’ve never lived in and declared as such have never required this.
Articles by others advice the same

(ps love the user name Little tree frog )

Upload it all at the same time.
If for any reason you can’t it can be posted but I’d phone hmrc first.
Uploading is very straight forward
Send everything all at once to avoid the faff.

I believe there is a time limit to complete the paperwork

Find all the info

Compete form

Submit

Agree

Its 90 days now.

Its 60 days

Oh blimey yes you are right. 👏
I need more coffee

I do hope @beachreader picks up on your correction there Littletreefrog !

Fab, this has been so useful. Thank you all so much. I know the 60 days, we only completed last week. Have a great day everyone

I did it myself in 2022. It was very easy. I definitely wouldn't get an accountant. I would say it took me something like 30 minutes. Maybe not even that long.

I completed mine myself

HMRC did not come back with any questions

My only issue was finding the original payments, but I did find them

I hope you don't mind me jumping in with a question.

On the death of our parent, I inherited one third of her property along with my 2 siblings who inherited one third each.

I paid each sibling one third of the market value of the property at the time and the property was transferred into my name and has been rented out since then. I will be selling it soon.

Is the starting point for the calculation of CGT, the market value of the property at that time, or the value of my one third at that time? Thank you for the previous information which has been very useful.

It depends how long you owned it as one third.
If it was several years then it’s 1/3rd for that period then transferring to 100% after you gained full ownership.

Its accepted that once you inherit there’s a short period of time before you sell etc and during that time as long as the property doesn’t increase above the probate valuation there’s nothing to pay.

I would take the starting point as probate valuation

Thank you so much.