Capital Gains Tax for Landlords. Simplified.
Capital gains tax when you sell a rental property
If you sell a buy to let or any property that is not your home, you may owe Capital Gains Tax on the profit. You must report and pay within 60 days on most UK property sales, which is shorter than most sellers expect. This page explains the deadline, the rates and how the gain is worked out. Checked against gov.uk on 18 October 2026.
Response within 1 business day
The 60 day deadline
You must report and pay any Capital Gains Tax on most sales of UK property within 60 days of completion. This is separate from your Self Assessment return. Missing it can lead to penalties and interest, so speak to an adviser before you exchange contracts, not after.
What counts as a taxable sale
Capital Gains Tax can apply to buy to let properties, business premises, land and inherited property. It does not usually apply when you sell your own home, and there are different rules for people living abroad. Gifts to a husband, wife, civil partner or charity are not usually taxed.
How the gain is worked out
Your gain is usually what you sold for minus what you paid. You can deduct the costs of buying, selling and improving the property, such as estate agents' and solicitors' fees and the cost of an extension. Normal maintenance such as decorating does not count. If you inherited the property, or were given it, the starting figure is its market value at that point, which is why records matter. If you own the property jointly, you work out the gain on your own share.
What every landlord needs to know
Understanding CGT:
The rates
For gains from 6 April 2026, a higher or additional rate taxpayer pays 24%. A basic rate taxpayer pays 18% on the part of the gain that fits inside the basic rate band once added to taxable income, and 24% on the rest. The tax-free allowance is £3,000 for the 2026 to 2027 tax year. Because the gain is added to your income to find the rate, a large property gain usually pushes part of it into 24%.
Reliefs and ways to reduce the bill
Possible reductions include the annual allowance, losses on other disposals, and Private Residence Relief where you lived in the property. Business asset relief may apply to business property. Which of these applies depends on your history with the property, so we do not list them as a promise.
Companies and non residents
A company that sells a property pays Corporation Tax on the gain, not Capital Gains Tax. Non residents who sell UK property also report to HMRC, under their own rules.
As an online practice, we work with landlords wherever they live.
Check your own sale
The tax on a sale can run to thousands of pounds, and decisions such as timing, who owns the property and how gains are shared change the bill. Our 45 minute online property tax consultation with a Chartered Tax Adviser works through your own sale.
Questions and answers
1. Do I pay capital gains tax on a second home? Yes, if you sell a second home or buy to let at a gain above your allowance. Your own main home is not usually taxed.
2. What is the capital gains tax rate on property in 2026 to 2027? 18% or 24% for individuals, depending on your income and the size of the gain, from 6 April 2026.
3. What if I miss the 60 day deadline? You can be charged penalties and interest. Contact an adviser straight away so the return and payment are made as soon as possible.
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4. Can I deduct the cost of improvements? Yes. Costs of improvement works, such as an extension, can be deducted from the gain. Normal maintenance cannot.
