Property disposal CGT - How much for an accountant?

ChilliBob

Guys,

My partner is disposing of her BTL at the moment, which will trigger a small amount of CGT she will have to pay. She's been a resident of said property for about half the time of owning it, and a landlord (is landlady a thing or is that just from the 80s Queen Vic?!) for the other half.

I've been quoted 650 plus VAT for a firm I use for other services. On the face of it, this seemed quite toppy, but not sure if others feel this is okay.

Thanks!

eskbanker

I suspect that most on here would just calculate CGT liability themselves, rather than paying someone else to do it!  Provided she has detailed records of the dates, costs, relevant expenses, etc (which she'd need to supply to a firm anyway), it shouldn't be difficult to calculate it?

ChilliBob

Yeah, that was my thinking. I think when we both looked into it a little while ago it started to get more complex though. I think the complications being:
1. That it hasn't always been BTL
2. It was purchased with a mortgage but then some 20% help to buy thing or something

It's not a huge amount - purchase price was something like 120-130 and sale is 190, so it'll take her over CGT levels but not by a million miles. I guess the question is, if she submits it and it's incorrect, what are the implications? - Just that HMRC might say nope, according to our calculations it's this much, hence you owe is more unless you can prove otherwise, or, will it be a large fine and a load of hassle?

eskbanker

https://www.tax.service.gov.uk/capital-gains-tax-uk-property/start/report-pay-capital-gains-tax-uk-property implies that HMRC do the calculation anyway....

ChilliBob

I've actually just spent the time since posting going through that with a semi accurate answer (she's not around atm). It seems the crux of it is how long you classed it as main residence tbh as opposed anything else like how it was financed. I'll get her to give me the info and we can both do it and see if we get the same answers!

lr1277

I was in a similar situation and paid £200 + VAT for a SA return. However as I have detailed in other threads, I had to check the accountant’s calculations and have some knowledge of the applicable law. I also did not have the complication of having lived in the property. 
My sale was in 2018 before the new requirement to pay the CGT within 30 days of completion. There are other threads about this on the tax board I think, where you have to notify HMRC about the sale and get some kind of code to pay the tax due.

lozzy1965

I sold a property I had let, a few years ago and the hard bit is getting all the figures together - which as eskbanker says you would have to provide to the accountant anyway.  From memory, I needed the the date I bought the property with all associated costs (plus and minus), the date and costs at time of sale.  Then there were one or more allowances based on time lived in as main residence (it was her main residence?) - so you will need to know the date(s) not living there.  For your information I also offset some of the gain against investments that I had that were running at a capital loss, including a negligible value claim - which worked out quite nicely.  It was fairly straightforward to just fill in the bits asked for on the form - reading the 'help' where needed. 

ChilliBob

I believe my partner has all the inputs, the private residence relief is the clincher, this makes a massive difference to her. From what I can see it's basically months lived there plus 9 / total months owned. This decimal can be multiolied by the CGT liability to work out the fraction you need to pay.

Based on that, I've said to her if we both come up eith the same answer given her inputs we're probably okay to do it ourselves.

Should come out to sbout 4k of cgt for her to pay, not too bad. 

dingling68

you will be asked to estimate the expected total income in the year to 5/4/22 from all sources to establish the rate of CGT to be used. Ownership for the purposes of the calculation is to the date of exchange, not completion

ChilliBob

dingling68 said:

you will be asked to estimate the expected total income in the year to 5/4/22 from all sources to establish the rate of CGT to be used. Ownership for the purposes of the calculation is to the date of exchange, not completion

Cheers, the last bit is a helpfull tip

Earnings will be easy in my partner's situation