Published: 22/06/2026 By Sarah-Jane Crean
Capital Gains Tax (CGT) mainly applies when you sell a second property, such as a buy-to-let, holiday home, or other investment property. It does not usually apply to your main home, which is typically exempt under Private Residence Relief.When you sell a second property, CGT is charged on the profit you make (sale price minus purchase price and allowable costs like legal fees, improvements, and selling costs). You may also be able to use your annual tax-free allowance, but anything above that can be taxable.
A key rule is the reporting deadline. For UK residential property sales, you must report the gain and pay any CGT due to HMRC within 60 days of completion. This is separate from your normal Self-Assessment tax return. It’s important to get this right as late or incorrect submissions can lead to penalties and interest.
For ease and peace of mind, an accountant can assist you by calculating your gain, apply any reliefs, and submit the return on time. An accountant can also help you decide how to buy a second property in the first place.
Buying personally is often simpler and gives more flexibility, but rental profits are taxed at your personal income tax rate, which can be higher depending on your earnings. An accountant can show how this affects your overall tax position.
Buying through a limited company can sometimes be more tax-efficient, as profits are taxed under corporation tax rules rather than income tax. However, there are extra costs and admin involved, and withdrawing money from the company can create further tax charges. An accountant can help weigh up whether the long-term savings outweigh the added complexity.
An accountant can also model different scenarios, such as renting, holding long-term, or selling to show how each option impacts CGT, income tax, and overall returns.
In summary, CGT primarily applies to second properties and the 60-day reporting requirement should not be overlooked. As experienced accountants we can support you across all aspects of property taxation, from meeting your compliance obligations through to helping you structure your investment in a practical, tax-efficient way from the outset.
Get in touch via email bsg@turpinba.co.uk or call 020 8661 7878