When you sell an asset such as property, shares, or a business that has increased in value, you may need to pay Capital Gains Tax (CGT) to HMRC. Understanding how and when to pay it can be confusing — especially with different rules depending on what you sold, where you live, and how you report the gain.
In this comprehensive guide, ABM Chartered Accountants explain exactly how to pay Capital Gains Tax to HMRC, the different payment methods, deadlines, and what to do if you’re missing records or unsure about your liability.
Whether you’re selling a second property, disposing of shares, or transferring business assets, this article will help ensure you report and pay correctly — and on time.
What Is Capital Gains Tax?
Capital Gains Tax (CGT) is a tax on the profit (gain) you make when you sell, give away, or otherwise dispose of an asset that has increased in value.
You don’t pay CGT on the total sale amount — only on the gain, which is the difference between what you paid for the asset and what you sold it for, minus any allowable costs such as legal fees, improvement expenses, or estate agent charges.
Common assets that can trigger CGT:
- Second homes or buy-to-let properties
- Shares not held in an ISA or pension
- Business assets or company shares
- Valuable personal possessions worth over £6,000 (excluding cars)
- Cryptoassets such as Bitcoin or Ethereum
When Do You Need to Pay Capital Gains Tax?
The deadline for paying CGT depends on what type of asset you sold and whether you are a UK resident.
1. If you sold UK residential property (after 6 April 2020)
You must report and pay your CGT within 60 days of the completion date of the sale.
This rule applies whether you sold:
- A buy-to-let property
- A second home
- A property you inherited and later sold
Example:
If you completed a sale on 1 May 2025, you must report and pay your CGT by 30 June 2025.
Failing to meet the 60-day deadline can lead to interest and late payment penalties, so it’s essential to act quickly.
2. If you sold other types of assets (shares, crypto, business assets, etc.)
You must report your gains and pay your CGT via your Self Assessment tax return.
The payment deadline is 31 January following the end of the tax year.
Example:
If you sold shares in September 2024 (during the 2024–25 tax year), you’ll need to pay any CGT due by 31 January 2026.
3. If you’re a non-UK resident
Even if you don’t owe any tax, you must report the sale of any UK property or land within 60 days of completion. Non-residents use the same online system as UK residents for reporting and paying CGT on UK property.
Step-by-Step: How to Pay Capital Gains Tax to HMRC
Let’s go through the process of actually paying your CGT, step by step.
Step 1: Work Out Your Capital Gain
Before you can pay, you’ll need to calculate your gain for each asset you sold.
You’ll need:
- The price you paid when buying the asset (the “base cost”)
- The amount you sold it for
- The dates you acquired and disposed of it
- Any allowable expenses (stamp duty, legal fees, estate agent costs, improvement costs, etc.)
If you sold multiple assets, calculate each one separately — some may have losses, which can reduce your overall tax bill.
If you’re unsure, an accountant can help you calculate the gain accurately and ensure you claim all available reliefs.
Step 2: Decide How You’re Going to Report It
There are three main ways to report your capital gain to HMRC:
1. Capital Gains Tax on UK Property Account
Used for:
- Sales of UK residential property (buy-to-let, second home, inherited property, etc.)
- Both UK residents and non-residents
You must create or sign in to your Capital Gains Tax on UK property account.
You’ll need:
- Your Government Gateway ID (you can create one online if you don’t have it)
- Details of your property and sale dates
- The amounts for purchase and sale, and any related costs
Once submitted, HMRC will calculate your tax and issue a 14-digit payment reference number (starting with “X”). You’ll use this when making your payment.
2. Real-Time Capital Gains Tax Service
This online service allows you to report gains on other assets (e.g., shares, crypto, business assets) as soon as they happen, without waiting for your annual tax return.
This method is useful if you don’t usually file a Self Assessment.
HMRC will review your submission and send you a payment reference number (usually starting with “RTT”). You can then pay using one of the methods below.
3. Self Assessment Tax Return
If you’re already registered for Self Assessment, or if you’ve sold multiple assets, you can report your gains as part of your annual tax return.
The deadline to file and pay is:
- 31 October (if filing by paper)
- 31 January (if filing online)
When you submit your return, HMRC will tell you how much you owe and how to pay.
Step 3: Make the Payment to HMRC
Once you’ve reported your gain and received your payment reference number, you can pay your CGT using one of the following methods:
1. Online Banking / Bank Transfer
The fastest and most common way.
Use these bank details depending on your HMRC payment location:
HMRC Cumbernauld
- Sort Code: 08-32-10
- Account Number: 12001039
- Account Name: HMRC Cumbernauld
HMRC Shipley
- Sort Code: 08-32-10
- Account Number: 12001020
- Account Name: HMRC Shipley
If you’re unsure which to use, pay to HMRC Cumbernauld.
Include your 14-digit reference number (starting with “X”) in the payment description.
Payments made via Faster Payments usually reach HMRC the same or next working day.
2. Debit or Credit Card
You can pay online using a debit or corporate credit card.
Go to the “Pay your Capital Gains Tax” page on GOV.UK and follow the secure payment link.
Note: There’s a small fee for paying with a corporate credit card.
3. Cheque by Post
You can send a cheque made payable to:
HM Revenue and Customs only
Write your 14-digit reference number on the back and send it to:
HMRC
Direct
BX5 5BD
United Kingdom
Allow at least 3 working days for HMRC to process cheque payments.
4. Bank Payment from Overseas
If you’re outside the UK, use the following international bank details:
- IBAN: GB03 BARC 2011 4783 9776 92
- BIC/SWIFT: BARCGB22
- Account Name: HMRC Shipley
Step 4: Keep a Copy for Your Records
Always save or print a copy of:
- Your CGT return submission
- The payment confirmation or receipt
- Any related correspondence from HMRC
HMRC may request evidence or documentation years later, so it’s wise to store all supporting details securely.
What If You’ve Lost Your Purchase Records?
Many people panic when they can’t find the purchase documentation for a property or shares. Fortunately, HMRC allows you to use reasonable estimates if records are missing.
Here’s what you can do:
- Check Land Registry for property purchase details.
- Ask your solicitor or estate agent if they can provide old transaction statements.
- Contact your stockbroker for historic share purchase data.
- Use online financial portals for estimated share prices on the purchase date.
Make sure to include a note in your CGT submission explaining that figures are based on the best available estimates. This transparency reduces the risk of penalties if HMRC later checks your return.
What Happens If You Miss the Deadline?
If you miss your CGT payment deadline, HMRC can charge:
- Interest on the unpaid tax (from the due date)
- Late payment penalties
The penalty amount depends on how late the payment is, but typically:
- £100 fixed penalty if your return is up to 3 months late
- Further daily penalties if it goes beyond 3 months
The best approach is to report and pay as soon as possible. Even if you can’t afford the full amount, HMRC may agree to a Time to Pay arrangement if you contact them promptly.
CGT Allowances and Reliefs You Might Be Missing
Before paying your bill, ensure you’ve claimed all possible CGT reliefs to reduce what you owe.
1. Annual Exempt Amount
Every individual gets a tax-free allowance of £3,000 (2024–25 and 2025–26).
Couples can combine theirs for up to £6,000 in tax-free gains.
2. Private Residence Relief
If the property was your main home, you may not need to pay CGT at all for the period it was your primary residence (plus the final 9 months of ownership).
3. Letting Relief
Available if you let out part of your main home at some point — though the rules are narrower than before 2020.
4. Business Asset Disposal Relief (BADR)
Formerly called Entrepreneurs’ Relief — allows qualifying business owners to pay a 10% CGT rate when selling all or part of their business.
5. Spousal Transfers
You can transfer assets between spouses or civil partners tax-free, allowing you to use both annual allowances strategically.
An accountant can help ensure all these reliefs are applied correctly and that you’re not paying more than you owe.
Example: Paying CGT on a Second Home Sale
Let’s look at an example.
You sold a second home in August 2025 for £350,000.
You bought it for £200,000 and spent £10,000 on improvements and £5,000 on solicitor and agent fees.
Gain:
£350,000 – £200,000 – £10,000 – £5,000 = £135,000
After your £3,000 allowance, your taxable gain is £132,000.
If you’re a higher-rate taxpayer, you’ll pay 24% CGT (current rate for residential property).
Tax owed: £132,000 × 24% = £31,680
You must report and pay this via the Capital Gains Tax on UK property service within 60 days of completion.
Why Use a Professional Accountant?
Paying Capital Gains Tax correctly isn’t just about making the payment — it’s about:
- Calculating the gain accurately
- Applying every allowable relief
- Avoiding penalties for late or incorrect reporting
- Ensuring your tax position is as efficient as possible
At ABM Chartered Accountants, we handle the full CGT reporting process for our clients — from working out the gain to submitting your return and ensuring payment is made to HMRC on time.
Our experienced team of Canary Wharf accountants specialise in property tax, CGT, and Self Assessment for individuals, landlords, and investors across the UK.
We’ll ensure your reporting is compliant, stress-free, and tax-efficient — saving you time and money.
Need Help Paying Your Capital Gains Tax?
If you’ve sold a property, shares, or other assets and aren’t sure how to pay your Capital Gains Tax to HMRC, ABM Chartered Accountants can help.
We’ll:
- Calculate your gain accurately
- Claim every eligible tax relief
- File your CGT return correctly
- Guide you step-by-step through payment
Contact ABM Chartered Accountants today for expert CGT and tax planning advice.
Serving clients in London, Canary Wharf, and across the UK.
Frequently Asked Questions (FAQs)
1. Do I need to pay Capital Gains Tax immediately after selling an asset?
It depends on the asset. For UK residential property, you must report and pay within 60 days of completion. For other assets like shares or business sales, you can report and pay via your Self Assessment by 31 January following the end of the tax year.
2. Can I pay Capital Gains Tax in installments?
In some cases, HMRC allows a Time to Pay arrangement if you cannot pay the full amount at once. You must contact HMRC before the payment deadline to arrange this.
3. What happens if I don’t pay Capital Gains Tax on time?
Late payment results in interest charges and possible penalties. The longer the delay, the higher the penalty, so it’s important to report and pay promptly.
4. Do I need an accountant to pay CGT?
Not necessarily, but an accountant ensures your calculation is accurate, reliefs are applied correctly, and your payment is submitted on time. This often reduces your overall tax liability and avoids HMRC penalties.
5. Can I offset losses against my capital gains?
Yes, you can use losses from the same or previous tax years to reduce your overall taxable gains. You must report these losses to HMRC to carry them forward.
