Sold a Property? The 60-Day CGT Return and HMRC Penalties

Yes: if you sold UK residential property at a taxable gain, you generally had to send HMRC a property disposal return and pay the tax on account within 60 days of completion, and HMRC writes to sellers it thinks may not have done so. The Budget of 28 October 2026 announced a fix that stops late-filing penalties running once the sale is reported on a Self Assessment return, but we cannot confirm that it has become law, so the safe course today is still to file the 60-day return.

You are probably reading this because a letter has arrived about a house you sold, or because you have just remembered the 60 days and the sale was months ago. The answer surprises people because this return is separate from the annual Self Assessment return, and the tax falls due long before the usual 31 January deadline.

Who has to file a 60-day return after selling a property?

The return applies where you make a direct disposal of UK land on which a residential property gain accrues, for disposals made on or after 6 April 2020 (Finance Act 2019, Schedule 2, paragraph 1(1)(b)). It must be delivered “on or before” the 60th day following completion (paragraph 3(1)(b)), a period that was 30 days until section 23 of the Finance Act 2022 extended it for completions on or after 27 October 2021. The penalties for missing it are covered on our page about HMRC penalties.

No return is needed where no payment on account would arise under paragraph 6 (paragraph 4). That commonly covers a sale of your main home and a sale at a loss, but the test is whether tax is notionally chargeable at the filing date, so check the calculation before you rely on it. Sellers of rented homes should be especially careful, and our landlord and tenant solicitors deal with the wider disputes that follow a sale.

When is the tax due, and is it the final bill?

Payment falls due on the same day as the return. Paragraph 6(3) says the amount is “payable on the filing date for the return”, and paragraph 6(2) makes it a payment on account of your capital gains tax for the tax year. Your final liability is settled through your Self Assessment return, where the figures can change, and our HMRC tax dispute lawyers can check the number before you pay or challenge it.

Why has HMRC written to you about a sale?

HMRC reviews the data it holds and sends one-to-many letters about the 60-day return before the deadline has passed. People who believe no return is needed are asked to contact HMRC using the details in the letter. We have written before about HMRC’s capital gains tax nudge letters, and the same approach applies to property sales.

A nudge letter carries no penalty and makes no accusation. It does tell you that HMRC holds a record of the sale, so ignoring it leaves you with the same deadline and less room to say you did not know. If a letter goes unanswered, HMRC can open an enquiry, which we describe under HMRC tax investigations.

What to do in the first week after the letter arrives

Find the completion date, count 60 days forward, and see whether that date has passed. If it has not, you can still file in time. If it has, file now, because penalty dates are fixed by reference to the filing date, and our guide to tax penalty appeals explains what follows once one is issued.

Then collect the completion statement and the paperwork from when you bought, since the gain depends on what you paid and spent. If the figures are unclear or HMRC’s version looks wrong, a second opinion on an HMRC position is worth having before you reply.

What happens if you missed the 60 days?

Late-filing penalties follow Schedule 55 to the Finance Act 2009, which reaches these returns through item 2A of the table in paragraph 1(5). The first penalty is £100 once the filing date has passed (paragraph 3). Daily penalties of £10 for up to 90 days apply only if the failure continues three months after the penalty date, HMRC decides one should be payable, and HMRC gives notice of the start date (paragraph 4). At six months the penalty is the greater of 5% of the liability and £300 (paragraph 5), and at twelve months paragraph 6 adds a further penalty, which is higher where the information was deliberately withheld, as we explain in HMRC behaviour assessments.

Late payment is separate. A penalty can arise under Schedule 56 to the Finance Act 2009 (item 3B, added by paragraph 30 of Schedule 2 to the Finance Act 2019), and interest runs under sections 101 to 103 of the 2009 Act. We give no rates because they change, and the figures on your own notice are the ones that count. If you cannot pay in full, HMRC time to pay arrangements are the usual route.

The Budget 2026 penalty fix: what it changes and where it stops

The measure published with the Budget on 28 October 2026 would insert a new paragraph 5A into Schedule 2. Where you did not deliver the return by the filing date and later deliver your ordinary tax return “containing a self-assessment that takes account of the disposal”, you cease to be required to make the 60-day return from that time. A matching change to paragraph 4 of Schedule 55 means the failure to file is no longer continuing after that point, so further late-filing penalties stop accruing, as we also note in our summary of the 2026 HMRC penalty rules.

Read the limits before relying on it. The text we have seen is a draft Finance Bill measure, and we could not confirm Royal Assent. It has effect where the ordinary tax return is delivered on or after 28 October 2026. Penalties already accrued are not shown as cancelled, and the Self Assessment return must still take account of the disposal under the paragraph 5(2) test, which asks whether the tax self-assessed is at least the amount paragraph 6 would have required. Our taxation solicitors in London can tell you how the draft applies to your dates.

Should you wait for the fix?

Waiting costs money. Until the measure is law, the 60-day return remains required, the payment on account stays due on the filing date, and penalty dates keep arriving. The Government’s own policy paper describes the change as made without removing the requirement to submit the return, and unpaid tax can end in HMRC enforcement action.

Other clocks run too. A penalty must be paid within 30 days beginning with the day notification is issued (Schedule 55, paragraph 18(2)), and an appeal against an assessment must be given within 30 days after the specified date (Taxes Management Act 1970, section 31A(1)(b)). Missing that window is not the end, as late appeals against HMRC and our page on late appeals to the tax tribunal both show, but permission is never automatic.

Did my conveyancer deal with the capital gains tax?

Searches for tax on selling a house bring up stamp duty, inheritance tax, the annual Self Assessment return and this 60-day return, and each has its own deadline. Many sellers assume the solicitor who handled the sale also handled the tax. A conveyancer acts on the transfer, and unless someone agreed in writing to prepare your return, the filing is yours. Where a conveyancer did take on a tax task and got it wrong, our pages on property and conveyancing negligence and a conveyancer’s stamp duty mistake show how those claims work.

The same question arises with accountants. Reliance on another person is not a reasonable excuse unless you took reasonable care to avoid the failure (Schedule 55, paragraph 23(2)(b)), but an adviser who agreed to file and did not may owe you the penalties. We explain this in suing a tax adviser over HMRC penalties and in our guide to negligent tax advice claims.

Which excuses does HMRC accept?

You are not liable to a penalty if you satisfy HMRC or the tribunal that you had a reasonable excuse (Schedule 55, paragraph 23(1)). Insufficiency of funds is not a reasonable excuse unless attributable to events outside your control (paragraph 23(2)(a)), and an excuse that has ended is treated as continuing if you remedy the failure without unreasonable delay (paragraph 23(2)(c)). Our overview of HMRC tax appeals sets out how that argument is put.

HMRC may also reduce a penalty for special circumstances under paragraph 16, which can include staying a penalty or agreeing a compromise, although ability to pay is excluded (paragraph 16(2) and (3)). You can ask for an HMRC internal review before going to the First-tier Tax Tribunal.

If you cannot pay the tax on account

Do not wait for HMRC to escalate. Agree a plan early, and read what HMRC can do if a debt is left, including whether HMRC can take money directly from your bank account.

Tax debt that HMRC pursues to the end can lead to a bankruptcy petition. Our guide to whether HMRC can make you bankrupt covers the risks, and Breathing Space against HMRC and other creditors explains one form of temporary protection.

How LEXLAW Can Help

We act in disputes with HMRC, including late-filing and late-payment penalties on property disposal returns, appeals to the tribunal, and claims against advisers who got it wrong. We do not give free legal advice and we do not offer legal aid, and we generally take substantial matters. Our HMRC tax dispute lawyers page sets out the work.

We are dual-qualified, with chambers in Middle Temple next to the Royal Courts of Justice. We offer a fixed-fee advice conference with a solicitor and a barrister through our fixed-fee second opinion service, and you can begin with our case assessment form.