CGT and payments on accounts

by **dasmith** on Tue Jan 24, 2012 4:32 pm

Hope someone can help

For the year 5/4/11 my sole trader trading profits were £50k

For the year ended 5/4/12 profits will be £20k

I would like to reduce my payments on account but within the April 12 year I also made a capital gain of £100k, can i pay the cgt in Jan 13 or do i have to absorb the cgt liability in the poas?

thanks

by **RAL** on Tue Jan 24, 2012 5:50 pm

POA's are payable on income tax and nic NOT on CGT.

If you made (make) a gain in April 2012 then CGT is payable on 31/01/2014. But if you meant April -11 then it is payable on 31/01/2013.

by **dasmith** on Tue Jan 24, 2012 5:53 pm

Thanks
The gain is in November 2011 so within the April 12 year, but my query is can i reduce the payments on account for 2012 to just cover my self employed earnings or do i need to increase to cover the gain.

eg do i have to pay half of the cgt this january or can i delay and pay the full amount as a balancing payment next jan 13

by **RAL** on Tue Jan 24, 2012 6:08 pm

Payment on account for a tax year is based on tax due for the previous tax year. The tax due being tax liability less tax deduted at source. No payments on accounts are required in respect of capital gains tax. CGT is due and payable on 31 January following the year in which the capital gains was made. Therefore gains made in 2011/12 is payable in one lump sum on 31/01/2013.

You can reduce the payment on account based on your expected self employed earning. But do remember that if you do if the self employed earning turn out to be higher than £20k you would end paying the interest. There are some information on HMRC's website have a look at them