Do I Need an Accountant to Calculate My Capital Gains

Introduction

Capital Gains Tax applies when you sell or dispose of an asset that has increased in value. The tax is paid on the gain you make, not on the total sale price. While it is possible to calculate CGT yourself using HMRC’s online tools, many people find the rules complex, particularly when multiple assets, allowances, or reliefs are involved.

Whether you need an accountant depends on how confident you are with tax calculations and how complicated your financial situation is.

When you may not need an accountant

If your circumstances are straightforward, you may be able to calculate and report your capital gain without professional help. For example, you might not need an accountant if:

You sold a single asset, such as shares or a second home, and the gain is clearly below your annual exemption.

You have kept all your records, including purchase and sale prices, receipts, and fees.

You have no other disposals or capital losses to consider.

You are comfortable using HMRC’s Capital Gains Tax calculator and reporting tools.

In simple cases, you can use HMRC’s online calculator to estimate your gain and file your return through your Capital Gains Tax on UK property account or your Self Assessment tax return.

When it helps to use an accountant

Capital Gains Tax rules can become complicated quickly. It is worth considering professional help if:

1. You have sold multiple assets

If you have sold several properties, shareholdings, or other investments, each transaction must be assessed separately. An accountant can help ensure all gains and losses are calculated correctly and that you do not miss any available reliefs.

2. The property was once your main home

If the asset sold is a property that you lived in for part of the time, the calculation involves Private Residence Relief and possibly Letting Relief. These reliefs can significantly reduce your CGT bill, but applying them incorrectly could lead to errors or penalties.

3. You have inherited or gifted assets

The rules differ when you inherit, gift, or transfer assets to someone else. An accountant can determine whether the transaction is taxable and calculate the gain based on market value at the time of the gift or inheritance.

4. You are unsure which costs you can deduct

You can reduce your taxable gain by deducting certain costs, such as legal fees, estate agent commissions, or improvement expenses. An accountant ensures you claim everything you are entitled to while excluding non-allowable costs such as maintenance or mortgage interest.

5. You have made a large or complex gain

If the gain is substantial, getting it wrong could be costly. An accountant can check the figures, verify that reliefs like Business Asset Disposal Relief or Rollover Relief are applied correctly, and make sure you only pay what you owe.

6. You have losses from previous years

If you have capital losses from other investments, an accountant can help you carry them forward and offset them against current or future gains, reducing your tax bill.

7. You are non-UK resident

Different CGT rules apply to non-residents who sell UK property or assets. Accountants with international tax experience can ensure compliance with reporting deadlines and double taxation agreements.

What an accountant can do for you

An accountant provides more than just calculations. They can:

Review your records and ensure they are complete.

Identify all allowable expenses and reliefs to reduce your gain.

Complete and file your CGT report or Self Assessment accurately and on time.

Advise on future tax planning, such as using your annual exemption efficiently or transferring assets between spouses.

Represent you if HMRC queries your return.

For many people, the cost of hiring an accountant is outweighed by the potential savings from accurate calculations and proper use of reliefs.

How much it costs to hire an accountant

The cost of hiring an accountant for Capital Gains Tax varies depending on complexity and location. For a straightforward property sale, fees typically range from £200 to £600. Complex cases involving multiple assets or reliefs may cost more.

Before hiring someone, ask for a clear quote and make sure they are qualified, ideally as a Chartered Accountant (ACA or ACCA) or Chartered Tax Adviser (CTA).

Deadlines for reporting and paying CGT

If you sell a UK residential property, you must report the gain and pay any CGT due within 60 days of the completion date using HMRC’s online service.

For other assets, such as shares or commercial property, you can report the gain through your Self Assessment tax return, usually due by 31 January following the end of the tax year.

An accountant can help you meet these deadlines and avoid penalties for late filing or payment.

The risk of getting it wrong

Mistakes in Capital Gains Tax calculations can lead to:

Paying more tax than necessary.

HMRC penalties for underreporting or late filing.

Losing out on valuable reliefs or allowances.

Time-consuming corrections and correspondence with HMRC.

Professional advice can prevent these issues, especially if your situation involves multiple transactions or complex ownership arrangements.

Example scenario

David sells a rental property for £350,000. He bought it for £200,000 and spent £25,000 on renovations. After deducting estate agent and solicitor fees, his gain appears to be £120,000.

However, part of the property was once his main home, meaning some of the gain qualifies for Private Residence Relief. An accountant recalculates his figures and reduces the taxable gain to £75,000, saving him several thousand pounds in tax.

Common mistakes people make

Forgetting to include buying and selling costs.

Misunderstanding how to apply reliefs or exemptions.

Reporting after the 60-day deadline for UK residential property sales.

Not offsetting past capital losses.

Assuming CGT applies to the entire sale price rather than the gain.

An accountant ensures these mistakes are avoided.

Conclusion

You do not have to use an accountant to calculate your Capital Gains Tax, but professional help can save time, stress, and money, especially in complex situations. If you have multiple assets, property transactions, or reliefs to apply, an accountant’s expertise ensures you pay the correct amount and stay compliant with HMRC rules.

For simple cases, you can calculate and report your gain yourself using HMRC’s online tools. However, if you are unsure, even a short consultation with a qualified accountant can give you peace of mind and help you avoid costly errors.