Calculating income for CGT mid-year?

Calculating income for CGT mid-year?

14:41 PM, 30th November 2020, About 3 years ago 11

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I am about to sell a rental property which will generate a capital gain which I will need to pay within 30 days. Can anyone advise me how to calculate my income from the property so that I can calculate what I owe bearing in mind that there are 4 months before the end of the tax year?

I am likely to complete on my property sale on 7/12/20. To calculate the CGT that I owe, the HMRC calculator requires me to input my income for the tax year 20/21 and we have 4 months to go before the end of the 20/21 tax year. I will not know my income from property until the 20/21 tax year is over.

For example, do I calculate the income at the point I make the sale? Do I use last year’s figures? Do I estimate on the basis that all rent will be paid and there are no unforeseen expenses?

I am sure that any over/underpayment will be addressed when I submit the return after April, but I would like to pay the minimum at this point.  I would like to know if there is an HMRC approved method of estimating property income mid-way through a tax year.

I am wondering if I am missing something or not explaining my dilemma clearly enough. Apologies if that is the case. However, I had assumed that anyone selling a BTL property since the 30-day rule was announced would face the same issue.

Many thanks


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Judith Wordsworth

10:57 AM, 5th December 2020, About 3 years ago

Reply to the comment left by Mervin SX at 03/12/2020 - 18:57
Depends if you use a cash basis for your tax return then you don't take into account rental debts etc

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