HMRC has issued a reminder to taxpayers completing their Self Assessment tax returns that its online software cannot automatically handle the recent mid-year increase in Capital Gains Tax (CGT) rates, effective from October 2024.
Announced as part of the Autumn Budget in October 2024, the CGT rate rise was implemented immediately.
However, HMRC’s software has not been updated to accommodate the change. As a result, taxpayers will need to manually calculate their CGT liability for the period from 6 April 2024 to 30 October 2024, and for the period from 30 October 2024 onwards, rather than relying on HMRC’s automated calculators.
The required calculations should then be entered into box 51 of the CGT summary page of the Self Assessment tax return.
This affects taxpayers who have sold taxable assets, such as shares, cryptocurrency or second homes, after 30 October 2024.
HMRC has advised that taxpayers may need to use an adjustment calculator available on gov.uk to work out any changes to the tax automatically calculated by the system.
How did the CGT rates change in 2024?
On 30 October 2024, the main rates of CGT were raised to 18 per cent for basic rate taxpayers and 24 per cent for those in higher tax brackets.
The Chancellor’s decision to implement the increase immediately, on the day of the Budget, was designed to prevent tax planning strategies that might have been used to avoid the new higher rates of CGT.
If you’ve made a capital gain during this period and need help calculating your tax liability or understanding how to report it correctly, our team is here to assist you. Please don’t hesitate to get in touch for expert guidance.
