My client, Propco GmbH, received a nudge letter from HMRC regarding an unreported property disposal. The property was not rented out or used personally. It was a London flat acquired purely as a capital investment and was sold on 16 September 2021, realising a gain for the company of £1,750,000.

The disposal took place in the company’s statutory accounting period ending 31 August 2022 and our client believed that UK corporation tax on the gain was payable by 1 June 2023 and the return would need filing by 31 August 2023, although they did not seek professional advice until they received the nudge letter.

We have done our own research and established that the disposal creates a corporation tax chargeable accounting period of one day, being the date of disposal.