The 60-Day Rule: Reporting and Paying Capital Gains Tax on UK Residential Property
A taxable gain on UK residential property must be reported and paid within 60 days of completion, through the HMRC Capital Gains Tax on UK property account, separately from and usually well ahead of the annual self assessment return. UK residents report only where a taxable gain remains after reliefs, whereas non-residents must report all disposals of UK property and land even with no tax to pay. This note sets out the deadline, the rates, the annual exempt amount, how private residence relief interacts, and the penalties for filing late. It is general information, not advice.
A separate deadline that catches people out
Most people assume capital gains tax on a property sale is dealt with through the annual self assessment return, filed by the following 31 January. For UK residential property that assumption is wrong, and expensively so. Since 6 April 2020 there has been a stand-alone obligation to report a taxable residential property gain and pay the tax due within a tight window that runs from completion, entirely separate from, and usually months ahead of, the ordinary self assessment cycle. The gain must still be entered on the annual return afterwards, with the tax already paid credited against the final position, but the in-year report comes first. This is general information rather than advice, and the facts of any particular disposal, including the availability of reliefs and the exact figures, should be checked before you rely on them.
Who the obligation applies to
There are two populations to keep apart. UK residents must make a 60-day report where a disposal of UK residential property produces a taxable gain, meaning a gain that is not fully sheltered by reliefs or the annual exempt amount. If there is genuinely no tax to pay, a UK resident generally does not need to make the in-year report at all. Non-UK residents sit under a stricter rule: they must report all disposals of UK property and land, residential or not, within 60 days, even where there is no tax to pay and even where the disposal produces a loss. HMRC states plainly that a non-resident must report disposals of UK property or land even if they have no tax to pay on the disposal. The two regimes share a deadline but not a threshold.
When the 60-day clock starts
The deadline runs from the date of completion, not the date contracts are exchanged and not the date the money reaches your account. For completions on or after 27 October 2021 the window is 60 days. For completions between 6 April 2020 and 26 October 2021 the window was 30 days; the extension to 60 days was announced at the Autumn Budget 2021 following a recommendation from the Office of Tax Simplification, and it is the 60-day figure that matters for any current sale. Sixty days is shorter than it sounds once conveyancing paperwork, valuations for any period of non-residential use, and the arithmetic of base cost and improvement expenditure are taken into account, so the sensible course is to assemble the figures before completion rather than after.
How to report through the property account
Reporting is done through the HMRC Capital Gains Tax on UK property account, which is separate from your ordinary self assessment login and must be set up before you can file. You create the account, work out the gain, submit the return and pay the tax due, all within the 60-day window. An agent such as this firm can report on your behalf, but the account has to be created by you first and the agent then linked to it, so leaving the set-up to the final week is a common and avoidable cause of a late return. There is a paper alternative for the minority who cannot use the online service, but for most disposals the online property account is the intended route and the one that keeps the audit trail clean.
Rates and the annual exempt amount
For 2024/25 onwards the annual exempt amount is £3,000 per person, down sharply from earlier years, and it remains £3,000 for 2026/27, so a far larger share of ordinary sales now produces a taxable gain. The rates on residential property gains are 18 per cent to the extent the gain falls within any unused basic-rate band and 24 per cent on the balance above it. The higher residential rate was reduced from 28 per cent to 24 per cent with effect from 6 April 2024, while the lower rate stayed at 18 per cent. Because the split between 18 per cent and 24 per cent depends on how much basic-rate band your income leaves free, the in-year calculation uses an estimate of your income for the year, which is then trued up when the annual return is filed.
How private residence relief changes the picture
Private residence relief is the reason many home sales fall outside the 60-day rule entirely. Where a property has been your only or main residence throughout your period of ownership, the relief will usually cover the whole gain, no tax is due, and a UK resident then has nothing to report in year. The position shifts where the relief is only partial, for example a property let out for part of the ownership period, used partly for business, sitting on large grounds, or held for a spell when it was not your main home. In those cases a taxable gain can remain after relief, the 60-day report is triggered, and the tax must be paid on time. Non-residents, by contrast, must still report even a fully relieved disposal, because their obligation does not depend on there being tax to pay.
Penalties for filing or paying late
The late-filing regime broadly mirrors self assessment. Miss the 60-day deadline and an initial fixed penalty of £100 applies, with further penalties accruing as the delay lengthens and interest running on any tax paid late. Because the penalties escalate with time rather than with the size of the gain, even a modest disposal reported months late can attract a meaningful charge, and a fully relieved non-resident disposal with no tax at stake can still be penalised for the missing return. Penalties can be appealed where there is a reasonable excuse, but the far better course is to treat the completion date as the start of a fixed 60-day countdown and to have the figures ready in advance, so that filing and payment are a formality rather than a scramble.
Common questions
Does the 60-day rule apply if I make a loss? For a UK resident, no in-year report is needed where there is no taxable gain, though reporting a loss through self assessment preserves it for future use; for a non-resident, the disposal must still be reported within 60 days even at a loss. Do I still put the gain on my tax return if I have already reported it in year? Yes, if you are within self assessment the same gain goes on your annual return, with the tax already paid through the property account credited against the final figure, so you are not taxed twice. What if two of us own the property jointly? Each owner reports their own share of the gain separately and each has their own £3,000 annual exempt amount, so a jointly owned disposal generally means two 60-day returns rather than one.
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This article is general information only and does not constitute tax advice. Figures and dates are current as at the date of writing; any worked example is illustrative. Always consult a qualified adviser before acting.