CGT and self assessment questions from a luddite!

delmonta

Hi, apologies in advance for any silly questions. It seems the more I search online the more I confuse myself...

I am registered to fill in a self assessment tax return, for years the only section I'd fill out was from renting my property as I was working in Asia. I came back at the start of lockdown and have been renovating my house for 2 years, with no income from anything. I am now looking at filling out my 2020/2021 tax return. When I go to the website to fill it in, I clicked 'Do I need to fill out a tax return', and answer all the questions to which it says I do not need to fill one out. 

But then I got an email after logging in saying : 

"Our records show that you’ll need to send us your Self Assessment tax return and pay any tax you owe by 31‌‌ ‌January 2022.

You’ll still need to submit a return even if you don’t owe any tax." So I'm a bit confused, do I or don't I need to submit one if I didn't make any money? I just had lots of tax deductible expenses from fixing my house up. And a second confusing matter. I bought cryptocurrency in 2018 just before the crash and lost a lot (on paper) and from terrible trades and decisions. I didnt realise every crypto trade was a taxable event, it wasn't clear back then. Now it seems I have quite substantial losses from 2018/2019. It says on the HMRC website you can claim Capital Gains Losses up to 4 years after disposing of the assets, and then use those losses to offset any future gains. So of course I'd like to do this. I'm just confused, do I do that on this years tax return? Or do I have to fill out a tax return for 2018, and if so how do you fill out a return for a past year? I had already submitted tax returns for those years, and at the time had no idea of the rules for Cryptocurrency so didnt include anything, will this be a problem? Sorry if any of this is confusing, I'm confused! thanks in advance

Jeremy535897

If you are required to submit a tax return, then you must do so, whether you have any taxable income or gains or not. You need to tell HMRC to stop issuing returns if you don't need to complete them:
https://www.litrg.org.uk/tax-guides/tax-basics/do-i-need-complete-tax-return#what-do-I-do-if-I-no-longer-need-to-complete-a-tax-return

You cannot amend 2018/19 online. You need to write to HMRC. See:
https://www.gov.uk/self-assessment-tax-returns/corrections
https://www.gov.uk/capital-gains-tax/losses (gives the address to write to through a link)

delmonta

Jeremy535897 said:

If you are required to submit a tax return, then you must do so, whether you have any taxable income or gains or not. You need to tell HMRC to stop issuing returns if you don't need to complete them:
https://www.litrg.org.uk/tax-guides/tax-basics/do-i-need-complete-tax-return#what-do-I-do-if-I-no-longer-need-to-complete-a-tax-return

You cannot amend 2018/19 online. You need to write to HMRC. See:
https://www.gov.uk/self-assessment-tax-returns/corrections
https://www.gov.uk/capital-gains-tax/losses (gives the address to write to through a link)

Thanks

ok I didn't realise I had to write. But on the page you linked to it says to write if:  'If you’ve never made a gain and are not registered for Self Assessment'

But I am registered for self assessment. But you say this still applies to me? And what am I meant to include in this letter? It seems odd there is not form for what I'm doing, or a way to fill it out online

Jeremy535897

The link with the details of who to write to are at:
https://www.gov.uk/government/organisations/hm-revenue-customs/contact/capital-gains-tax-enquiries-for-individuals-employees-and-self-employed
This tells you where to write. You will have to point out that you omitted the transactions from your 2018/19 return, but if the proceeds in total from all chargeable assets sold were under £46,800 for 2018/19, you weren't obliged to report the transactions.