During the Budget 2021 press conference, Rishi Sunak announced the extension of the window for the disclosure and payment of the Capital Gain Tax (CGT) from the current 30 days to 60.
The time extension for the payment of the Capital Gain tax aims to give more time to UK property owners, who will now have enough time to find the necessary documentation, useful for disclosing and paying the Capital Gain Tax. The provision will give more time to the property owners to notify the sale.
As mentioned on Gov.uk website, this measure is not expected to have significant macroeconomic impacts, but it is expected that it will impact approximately 75,000 individuals per year, trustees and/or representatives of deceased persons who sell or otherwise dispose of land in the UK.
UK residents would suffer if they were to sell their property from which taxable profits derive, such as a second home or rental property. Even non-residents who own any type of property in the United Kingdom are given the same treatment.
The provision will be valid from midnight on October 27, 2021, and it will be addressed to the UK and non-UK residents, owners of property in the United Kingdom. Regarding the sale by UK residents of a UK-based property for mixed-use, the legislation will need to clarify whether the 60-day payment window will only apply to the residential element of the real estate gain.
The effect of the measure will have a positive impact on those who realize a capital gain from the sale of a property due to the lower pressure due to the extension of the time for filing the declaration and the payment of any tax.