Capital Gains Tax

GILL2244

Hello everyone. 

I recently paid a little over £9500 Capital Gains Tax following the sale of a property that I partly owned. After paying the tax it occurred to me that I had perhaps been a little hasty. Let me explain. I use an investment management company to purchase stocks / shares etc on my behalf. They (usually) send me a consolidated tax report each year. The report for 2023-24, in the 'Capital Gains Tax - Transaction Report' section stated that I had carried forward losses of £20,480.57. I had no tax report from my investment management company for 2024-25 - they stated that 'you no longer hold any assets in the taxable account. Everything is now held in the tax free ISA'. My question is - could I have used those carried forward losses of £20,480.57 from 2023-24 to avoid paying that Capital Gains Tax of £9500? If you perhaps need more information to advise on this - just let me know.

Thank you for your time.           

MeteredOut

In what year were the losses made? You say they were "carried forward losses" in the 2023-24 report.

Did you include those losses in any self-assessments?

It sounds like you should be able to offset the £9500 against the previous losses, but it depends on when those losses were actually incurred, any may require you to amend previous years self-assessments to include them, if not already done.

poseidon1

GILL2244 said:

Hello everyone. 

I recently paid a little over £9500 Capital Gains Tax following the sale of a property that I partly owned. After paying the tax it occurred to me that I had perhaps been a little hasty. Let me explain. I use an investment management company to purchase stocks / shares etc on my behalf. They (usually) send me a consolidated tax report each year. The report for 2023-24, in the 'Capital Gains Tax - Transaction Report' section stated that I had carried forward losses of £20,480.57. I had no tax report from my investment management company for 2024-25 - they stated that 'you no longer hold any assets in the taxable account. Everything is now held in the tax free ISA'. My question is - could I have used those carried forward losses of £20,480.57 from 2023-24 to avoid paying that Capital Gains Tax of £9500? If you perhaps need more information to advise on this - just let me know.

Thank you for your time.           

You say the 2023-24  report indicated you had carried forward losses, rather than brought forward losses ( from prior years) . This suggests the investment managers realised the losses in the 2023/24 tax year. You can check this your self by checking the schedule  breakdown of the 2023/24 investment transactions.

If you do indeed have £20,480 of carried forward losses then you have overpaid your 2025/26 CGT liability. 

If I were in your shoes I would dig out proof of the 2023/24 losses, make sure you had no excess taxable gains in 2024/25 that you may have failed to report and if none, lodge an amendment to your 2025/26 property gain return on the basis allowable losses were omitted in error  -  link below sets out the amendment process.

https://www.gov.uk/hmrc-internal-manuals/capital-gains-manual/cg-app18-256#:~:text=a tax year-,2.5.,of TCGA 1992 will apply,

Incidentally, bear in mind you still have to lodge a formal self assessment tax return to report the property gain yet again, this gives HMRC a chance  to check the basis of your computations.