Buy-to-let tax changes capital gains tax

Capital gains tax for landlords: do you know the rules?

All property investors and landlords selling an investment property must follow the latest capital gains tax rules, but it seems that many people are still in the dark about the requirements.

Staying abreast of the latest tax rules and changes can be one of the challenges of being a property investor or landlord, and many will seek independent advice to help them ensure they are paying the correct amount.

Since April this year, the capital gains tax threshold for anyone disposing of a property that is not their main residence was reduced from £12,300 to £6,000. So any profits made – normally the difference between purchase price and sale price – above this amount are subject to capital gains tax.

How much you owe, based on this property being owned by you personally as an individual tax payer, depends on your circumstances and earnings. You can find out more about how much you’ll owe on the government’s website.

Capital gains tax 60-day rule

So what aspect of capital gains tax is tripping up so many landlords and property investors? According to Rick Schofield of accountancy firm Azets, many people who sell a second home or investment property don’t realise that they must register their sale for capital gains tax with HMRC within 60 days.

This time limit has been in place since 2021, but according to Schofield, the less experienced landlords don’t always know that they must submit the information personally to HMRC using a government gateway account, which they must do themselves – it can’t be completed by a third party.

Failure to do so can result in a fine, which increases the longer you leave it. This issue has been highlighted more recently due to higher numbers of landlords selling up – but much of this is actually down to people cashing in for their pension pots, as around two thirds of UK landlords are aged 55 or over.

The 60-day deadline is the same for overseas investors, too, when selling UK property. Even where no capital gains tax is due, you must report the sale to HMRC within 60 days of completion.

Landlords cashing in

There are a number of reasons why property investors might sell an investment property, whether it’s to reinvest in something more profitable, release some cash for a particular purpose, or to reap the rewards of an investment as part of a retirement plan.

Of course, in the current climate, some landlords – particularly those with high levels of mortgage debt – may also be selling due to not being able to afford the higher costs.

“We have seen cases involving a number of buy-to-let landlords who have cashed in because they cannot afford to service higher mortgage debt; the rents aren’t covering the increases. They were caught off-guard by the Bank of England’s consecutive interest rate rises,” says Rick Schofield.

But this is when landlords can fall foul of the rules, and the 60-day time limit in particular.

Schofield points out: “That particular gateway form and process is not particularly well known amongst landlords. If you don’t submit the form within the 60 days, there is a £100 penalty. If the matter is still outstanding three months after that, it’s £300 or five per cent of the capital gains tax.

“If you have a string of disposals amounting to £3 million, and the landlords have not submitted the form in time, then that’s £150,000 HMRC can collect.”

According to Schofield, while many landlords in the sector are doing well, accidental landlords and those that are highly leveraged in particular might be more likely to sell up in a high interest and high inflation environment.

“However, some landlords are not selling up for forced reasons but rather to fund retirement – almost two thirds of landlords in England are aged 55 or above.

“There are around 2.74 million landlords in the UK, so you can understand how important it is for them to understand why the 60-day deadline matters and that it shouldn’t be confused with annual self-assessment tax returns.”

Self-certified Sophisticated Investor

Please read

I declare that I am a self-certified sophisticated investor for the purposes of the restriction on promotion of non-mainstream pooled investments. I understand that this means:

I am a self-certified sophisticated investor because at least one of the following applies:

I accept that the investments to which the promotions will relate may expose me to a significant risk of losing all of the money or other property invested. I am aware that it is open to me seek advice from someone who specialises in advising on non-mainstream pooled investments.

High Net Worth Investor

Please read

I make this statement so that I can receive promotional communications which are exempt from the restriction on promotion of non-mainstream pooled investments. The exemption relates to certified high net worth investors and I declare that I qualify as such because at least one of the following applies to me:


Sign up for first access to new developments and exclusive property investment opportunities.

We send limited and targeted emails on new launches and exclusive deals which best fit your areas. We are trusted by over 30,000 active buyers as their source for new stock.

  • New property developments
  • Professional market reports
  • Property deal alerts
  • Development updates
Manchester property investment


Receive trending news straight to your inbox and stay up to date on all of the property market trends and advice.

Established since 2005 we are a leading voice of authority and commentary on the UK property market. Our news is trusted by Apple News & Google News.

  • UK housing market
  • Mortgage & money
  • Buy-to-let landlords
  • Guides & advice

Talk to us

Speak to our UK property experts today:


+44 (0) 333 123 0320

Open from 9am-6pm GMT


+852 6699 9008

Open from 9am-6pm HKT