2nd
Sep 2016
The Conservative MP Kevin Hollinrake, has put forward an amendment to the Finance Bill calling for the government to reduce landlords’ capital gains tax when selling a property to a sitting tenant. The MP is also a co-founder of an estate agent’s chain.
The MP had previously condemned the former chancellor for excluding buy-to-let landlords from having tax breaks on their property gains when Osborne cut CGT in his last Budget.
Because of the new measures imposed by Osborne landlords have to face paying 28% capital gains tax when they sell a property, the ex-chancellor admitted that it is one of “highest in the developed world”.
Osborne had relentlessly targeted landlords and excluded them for the tax cut whilst other types of investors still benefit from the reduction of the higher rate of CGT down to 20% with the lower rate cut down from 18% to 10%.
The Tory MP has put forward amendment to Clause 72 of the finance Bill that would now allow landlords to proffer from the reduced 20% CGT rate when selling the property to a sitting tenant.
The amendment is currently being discussed in parliament and landlord groups have been campaigning for equality with other investors as many are considering leaving the sector. Research has been carried out with landlords and 77% would seriously consider selling their properties to existing tenants if the tax liability was reduced.
An industry spokesperson, said: “Many landlords are now considering their future in the market following recent tax increases whilst others will be looking to sell as part of the natural churn of properties in the rental market.
“This amendment would help achieve the Government’s aim of encouraging and supporting home ownership for aspiring first time buyers whilst easing some of the excessive tax burdens recently placed on landlords.”
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