So having - at the end of December - sold our old place that we'd been renting out for years since we bought somewhere else and moved there, I just went through the "Capital Gains Tax on UK property" process at
https://www.gov.uk/repor...n-or-after-6-april-2020

As I understand it, this was bought in because otherwise HMRC might be waiting another year until January 2025 and me doing our 2023-2024 tax returns before they got their hands on the chunky 5 figures we've each just paid (about 1/3 of the gain qualified for PRR relief - including the free 9 months - but we're exposed for the rest). But these days you have to pay it within 60 days of the sale.

Since it needs to know some stuff I cannot possibly know for sure until 2023-2024's tax return is done (income and losses for the year) I was careful to tick the "contains estimates" box. Am I right in assuming that when it comes to SA time, I'll basically need to reproduce the calculation (maybe with minor corrections/improvements) in the capital gains section (presumably showing working in an attachment) and all that this "Capital Gains Tax on UK property" thing will have done is effectively have been an advance credit to our tax accounts?

A couple of thoughts:

- When we were living in the place, we did do some spends which might have been considered "improvements" rather than just maintenance: installing a much nicer kitchen and converting the attic space (technically to a "boarded loft" rather than a bedroom). However we have absolutely no record of even memory how much we spent on those and the bank statements were shredded long ago. A shame, might have helped bump the book cost up a little but I am reluctant to guess with no evidence. Mainly mention it as a cautionary tale to others who might find themselves in a similar situation: hold onto those records even if you think you won't need them again because it's your gains-tax exempt residence at the time.

- One thing that surprised me: when the site asks for an estimate of losses, it's very clear that only losses before the exchange date can be used. A bit annoying as over the weeks after the completion I crystallized a bunch of losses (bond-heavy funds and REITs) with the express intention of offsetting the gains on the property. I assume this'll all come out in the wash at SA time (and we should get a bit of a refund as net gain will be less for the year overall when the losses are included)... or am I missing something important about fungibility of gains and losses?

Anyway, goodbye 17.6%pa compounder (before tax) over the ~26.6 years we owned it (capital value, not counting yield or benefit of living in it... although by the end the yield had become rather thin and hardly seemed worth the frequent expenses, stress and hassle involved).

17.6% is an amazing return, beating stocks I think. Add in leverage and your return on equity would be even greater.

Very unlikely to repeat.

My one is sitting on a loss having bought not that long ago. But probably look to sell and use the losses to offset against cgt which I have around £50k in my portfolio to diffuse over the years.

This is why I am quite sanguine about selling it.

Some years ago I remember reading some Sunday paper's money pages article about which year to buy property in recent decades had produced the best annualised returns subsequently. IIRC, it was sometime in the mid 1990s, which is when we bought. Cannot be coincidence that that was the last time charts of "affordability" show any sort of dip, presumably after the 1980s excesses and "negative equity" bust had reset things a bit.

I think CGT as a concept is fair enough, but removal of indexation relief and then tapering is a disgrace

Similar situation to me. Replaced the old dated kitchen for new. But I am not sure this would be classed as luxury. Some people would think not as its merely replacing old for new. Luxury would be seen as something like increasing the size of a kitchen substantially etc. But I am not sure.

I suppose there is no harm in assuming it as improvement and if challenged you can make your case (worse case you just pay the higher tax liability?). But you would need invoices etc. Depending what I sell mine for I certainly would like more losses to offset the gains on my portfolio. So I might put forward the kitchen costs as improvement and see what they say. I'll have to be careful about not diffusing the gains in my portfolio too much in case hmrc's potential challenge is successful, and so inadvertently having to pay out some cgt tax.