CGT - Capital Loss question

tigerspill

Hi,

Not sure if this is the right forum for this question, but here goes.

I have sold three BTL properties in the past three financial years.  Each made a loss.  Unfortunately I didn't realise that I needed to record capital losses on my Self Assessment returns.

I will be including the final one on my 2020/2021 SA return.

I have just agreed another property that will sell for a significant gain, and could really do with using all three capital losses from previous years (which I believe you can do for up to three previous years?).
Given that I haven't declared the capital losses in two of the tax years (2019/2020 and 2018/2019) - are these "lost" in the sense that I cant carry them into 2021/2022?  Or is there some way I can add them into my 2020/2021 tax return?

Basically, can I still use these undeclared capital losses or have I lost them due to not declaring?

Thanks

[Deleted User]

Presumably the proceeds from the sale of these properties amounted to more than four times the capital gains allowance, loss or not? (49200 in 2020/21) 

If so you should have declared the sale on each occasion. You can amend the 2019/20 until 31st January 2022. I believe that you will now have to inform HMRC of the earlier disposals by letter. Hopefully the loss will be accepted but one cannot be certain how the non-declarations will be viewed.

https://community.hmrc.gov.uk/forums/customerforums/sa/1649a218-b23e-ea11-b698-00155d974e7e

tigerspill

purdyoaten2 said:

Presumably the proceeds from the sale of these properties amounted to more than four times the capital gains allowance, loss or not? (49200 in 2020/21) 

If so you should have declared the sale on each occasion. You can amend the 2019/20 until 31st January 2022. I believe that you will now have to inform HMRC of the earlier disposals by letter. Hopefully the loss will be accepted but one cannot be certain how the non-declarations will be viewed.

https://community.hmrc.gov.uk/forums/customerforums/sa/1649a218-b23e-ea11-b698-00155d974e7e

Thanks for your reply.

All sale prices were above the 49k that you mention.  So looks like I definitely should have declared.
However, I forgot to mention a key point (I think) - apologies.  The houses were jointly owned between 4 people.  So for example, if the sale price was 60K, that would be £15K each so that would be below the £49Km limit?  Would this be correct?

Can I assume that because I made losses and therefore owed no tax, that by not declaring these (by not realising - I know that my lack of understanding is no excuse), that I won't be liable for fines etc.?

Maybe I should phone them?

[Deleted User]

Yes - quite a significant omission! I would contact them but would emphasise that the reason for not declaring the sales were due to the two criteria viz. The proceeds were below the annual allowance X4 AND there was no gain giving rise to a liability. 

tigerspill

[Deleted User] said:

Yes - quite a significant omission! I would contact them but would emphasise that the reason for not declaring the sales were due to the two criteria viz. The proceeds were below the annual allowance X4 AND there was no gain giving rise to a liability. 

Thanks again for responding.  I didn't realise there was an element of that actual sale price that mattered here when there was a loss.  I appreciate you taking the time to help and to educate me.

Jeremy535897

You have four years after the end of the year of assessment in which the loss is made, to claim the loss. See:
https://www.gov.uk/capital-gains-tax/losses

tigerspill

Sorry, another question.

I assume costs associated with a sale (estate agent and solicitor conveyancing costs) are set against CGT and not income tax?

[Deleted User]

tigerspill said:

Sorry, another question.

I assume costs associated with a sale (estate agent and solicitor conveyancing costs) are set against CGT and not income tax?

Yes!