CGT calculations

20122013

Please feel to move my post to the right thread.

I would like to see whether this UK Residential property CGT calculations is correct before submitting to HMRC.

Breakdown of calculations:

1. Total Capital Gain

• Sale Proceeds: £xxx (edit removed figure)
• Less Purchase Price: -£xxxx (edit removed figure)
• Less Total Allowable Costs: -£8,331 (£6,432 + £1,581 + £318)
• Total Capital Gain: £62169

2. Taxable Gain

• Total Capital Gain: £62,669
• Less Annual Exempt Amount: -£3,000
• Personal allowance: £12570
• Taxable Gain: £46599 (HMRC : £59169)

3. Capital Gains Tax (CGT) to Pay

£0 other taxable income

• First £37,000 taxed at 18% = £6,660 (HMRC First £37,700 taxed at 18% = £6,786.00)
• Remaining £9599 taxed at 24% = £2304
• Total CGT to pay: £8964

JGB1955

AIUI your Personal Allowance cannot be offset against CGT. Therefore your CGT bill comes to £11,938.56. (£37,700 @ 18% plus £21,469 @ 24%).

Dazed_and_C0nfused

https://forums.moneysavingexpert.com/discussion/6687146/cgt-calculations

Some of your figures don't make sense.

Is your Total Capital Gain £62,169 or £62,669?

Why do you think £37,700 x 18% is £6,660?

You cannot use the Personal Allowance against a Capital Gain.

poseidon1

You should use HMRCs handy CGT calculator. By doing so you will see you can make no deduction from your taxable gain by reference to the £12,570 personal allowance - see link embedded below

https://www.gov.uk/tax-sell-property/work-out-your-gain

In any event all your previous posts indicate you have taxable savings, and will be in receipt of employment income in the current tax year. Therefore on what basis can you possibly claim the entire £37,700 basic rate band to take advantage of the 18% CGT rate? You should note capital gains are added to your taxable income , and if by doing it takes most of your gains into 24% band then that constitutes your tax exposure.

Be aware if you under pay CGT, interest may accrue thereon for the entire period of the underpayment after the 60 day filing deadline.

EDIT

Because you can only estimate the level of your taxable income for the current tax year in dealing with the online property gain, you may need to revisit your computation by way of self assessment to adjust the tax paid to the correct figure - see below an article setting out the entire process -

https://www.litrg.org.uk/savings-property/capital-gains-tax/capital-gains-tax-reporting/60-day-reporting-rules-uk-property-disposals

Vitor

£11,938.56 is the correct figure, assuming the costs are allowable, the full £3,000 CGT exemption is available, and there are no further reliefs or losses.
The £12,570 Personal Allowance applies to income, not capital gains. Having no taxable income leaves the full £37,700 basic-rate band available for gains taxed at 18%. The balance is taxed at 24%

poseidon1

https://forums.moneysavingexpert.com/discussion/comment/82172322#Comment_82172322

The OP has calculated on the basis of no other taxable income, but recent posts indicate that is far from the case, especially if he took up the employment he mentioned in a July post. Indeed that same post (if it was from him) indicated that with the addition of bank interest he would be pushed into higher rate.

However, since this current post is so much at odds with previous ones, rather begs the question whether different people ( other family members?) are using the one user account to post their individual queries.

Perhaps this OP could clarify?

20122013

https://forums.moneysavingexpert.com/discussion/comment/82172419#Comment_82172419

Hi yes and thanks for asking, it is for another member of the family.