x
By using this website, you agree to our use of cookies to enhance your experience.
STAY CONNECTED!
    
newsletter-button

TODAY'S OTHER NEWS

Chancellor refuses to confirm plans to increase capital gains tax

Rishi Sunak has distanced himself from reports that he is looking at increasing capital gains tax to help pay for the government’s Covid-19 spending.

The Treasury announced this week it was commissioning the Tax Simplification Office to conduct a study in order to seek views “about capital gains tax”, prompting speculation that the chancellor was planning to hike taxes for buy-to-let landlords and other property owners, as part of wider plans to tackle an expected £350bn deficit this year.

But Sunak told Westminster’s Treasury Select Committee yesterday that the review was an administrative formality and not a sign he plans to increase capital gains tax.

He said: “It’s a reasonably business as usual practice for the Treasury to ask the Tax Simplification Office to examine various parts of our tax system to make sure they’re up to date. 

“It happens every year, so the last year or two the Tax Simplification Office looked at inheritance tax, before that they looked at capital relief, before that they’ve looked at VAT, they’ve looked at stamp duty and before that income tax and national insurance.

“So I think, actually, that capital gains tax is the only one they haven’t looked at if you look at everything they’ve done over the last few years.”

Poll: Do you think Rishi Sunak will increase capital gains tax to help pay for the government’s Covid-19 spending?

PLACE YOUR VOTE BELOW

  • icon

    Of course the chancellor cannot confirm or deny this. If does, there will immediately be increased or lower demand in property prices, therefore immediate increases or decreases in property prices ahead of the change actually taking place.
    The headline was unnecessary.
    BTW - sorry to have to say this, but given we're entering a time of extreme economic crisis, maybe second, third, etc. etc. homes (i.e. landlords' rental properties) should have higher CGT imposed - those with the broadest shoulders should bear the biggest burden. It's only fair. I wouldn't like this myself of course - but recognise it's only fair.
    (If you disagree, which taxes would you like to be increased instead to raise equivalent money for the Treasury? - it has to happen! Yes of course clamp down on rich people and companies using Cayman Islands, Luxembourg, etc. etc. as tax havens and employing accountants to find all sorts of tax loopholes - but governments have been saying that for years without doing much.)

    icon

    Landlords already pay higher CGT (28%) than stock market speculators and only get one tax free allowance no matter how many years they have owned the property. Happy to see fairness by all investors paying the same CGT, which will mean tax hikes for all other investors if they are to match the CGT paid by landlords.

     
  • Paul Barrett

    So you think mortgaged sole trader LL have broad shoulders!!??

    Fictitious income taxed with no income to pay for it
    LL victims of S24 would be better off selling up.
    LL are assailed by ridiculous cost burdens.
    Broad shoulders they certainly DON'T have.
    But that won't stop Sunak.
    He is coming for LL after 20 years of PRS CG.

    He is far more Corbyn than Corbyn ever was!

    LL are to be royally screwed

  • icon

    Why would I want to sell anything, just keep taking the income

  • icon

    LL will.be in the fireing line as usual. Easy pickings, no one likes us, the general perseption is we are all rolling in ill gaind cash from poor victim tennans, and have little expenses to worry about. We are not really seen by many politicians as running an actual business with many expenses . We have no voice in parliament, with only a pratictley usless and spinless organstion representing LL. but the well funded and organised anti landlord Shelter organisation constanlly villafiying LL everywhere and demanding LL fund and tax pratctley everything they can dream up. Every year it becomes an even more risky investment and less profitable business. No wonder so many LL are selling up.

  • icon

    Yes I'll be joining the herd... Sell up and move on... Enough is enough

  • Paul Barrett

    In light of all the grief that LL are being given I can see the leveraged PRS shrinking to almost nothing.

    50% of the PRS is supremely financially resilient as it has no leverage.
    Though of course it would suffer from rent defaulting tenants and the DYSFUNCTIONAL EVICTION process.
    But at least there would be no risk of repossession!


    There isn't much Govt can do against deleveraged LL even though they would dearly love to.

    I suppose RENT CONTROLS would hurt but I doubt sufficient to cause those LL to sell up.
    Taking rent income from unencumbered properties is still better than selling and putting the money in a savings account.
    After of course having paid a very substantial CGT bill!!

    It is really only the leveraged rental sector which has anything to worry about.

    It would be wise for LL to aspire to become unencumbered.
    The CV19 eviction ban etc has exposed how vulnerable leveraged LL are.

    We all understand the power of leverage.
    Well that only works when it can be ensured you have rent paying tenants.
    That is far from guaranteed now.

    I believe the PRS will need to become far more resilient and that can only come by LL selling and becoming unencumbered.
    Carrying out this strategy will result in a much reduced PRS.
    That will be good for the LL but very bad for tenants.
    But it must be an inevitable response to the constant Govt and Council attacks on the PRS as a whole.

    I believe the leveraged PRS houses about 3 million tenants.
    If this sector of the PRS withers away there will be significant homelessness.

    icon

    I'm not leveraged, I'm an old fashion Norfolk boy that was brought up to save first and buy for cash , I have been told many times that I'm doing it wrong, and I can see that in the past leveraged would have been the way to go, had I gone that way I would likely have had 50 properties today, but that would have been a lot for one 66 yr old hands on landlord to look after, maybe for those on here that are leveraged the way to go might be to sell just enough to pay off their borrowings then roll up their sleeves do their own cleaning, decorating and where possible repairs, PRS can and does work but it means work and not just sitting in an armchair watching the money roll into a bank account, I also get, and keep good tenants because I gain their respect for being the hands on landlord, of course my way would not suit everyone.

     
  • Paul Barrett

    @anthonytownshend

    Yep you could have gone down that 50 property route and most likely you would have been highly successful especially managing things yourself.


    But just imagine despite all your best endeavours you had been faced with 50 rent defaulting tenants.
    No ability to remove them and probably 50 mortgages to service at 75% LTV.

    Even if you were able to obtain mortgage deferments for all the properties that would have irrevocably damaged your credit rating and would have a significant effect on future business plans.

    There are probably many LL that have bern lured by siren voices of 75% LTV mortgages.

    They are in deep trouble with rent defaulting tenants that will take at least another year to evict.

    Of course if it wasn't for BTL there would be mass homelessness.

    Risk taking LL have with BTL provisioned the accommodation so desperately required by millions of tenants.

    They are now being systematically crucified by Govt and Councils.

    Had BTL LL adopted your no doubt far superior business strategy then rents would be far higher and also resultant far higher homelessness.

    But you are looking after no 1 and I consider your business model far superior to BTL.

    The risks of BTL have never really been acknowledged but it is a fact that rogue tenants cause over £9 billion of losses to the PRS annually.
    Most of these losses are caused by rent defaulting.

    Your business model doesn't mean you won't ever face a rent defaulting or otherwise wtongun tenant but you will NEVER face the risk of repossession.

    LL like me consider your business methodology as a far safer way to proceed.
    If that means we reduce to one property then so be it.

    Being leveraged at 75% LTV is now far too risky.
    Even if you were leveraged at 15% LTV on your imaginary 50 properties I doubt you would be able to meet monthly mortgage commitments if all the tenants rent defaulted.

    Personally I now aspire to do as you do.
    But it has to be stated that without brave risk taking BTL LL millions would be homeless.

    Unfortunately Govt considers those risk takers as beyond the pale and seeks to eradicate them


    For such LL retrenching to the position that you currently hold makes far more business sense.





    icon

    I do agree Paul but anthony, you got something wrong their mate, I've had a couple of large whiskys tonight, how many have you had ?

     
  • Paul Barrett

    Ahh!!
    Sorry about that.
    No completely sober.
    Just didn't check what I typed...................................Doh!!!

    Yep as an example of a mortgage free LL you remain on a pedestal as far as I am concerned!
    One day when I grow up I'm gonna be like you!!!

    No longer at the mercy of feckless rent defaulting tenants.
    I could cope with such feckless tenants but not when I'm mortgaged at 75% LTV.

    If there was a fast track eviction process for rent defaulting tenants then the BTL model would be more viable.

    But with eviction scheduled to become even more difficult the BTL business model is busted.

    Govt and Councils care more about supporting feckless rent defaulting tenants than allowing LL to have opportunity to operate their business.

    It is the pathetic eviction process which undermines the BTL business model.
    I speak from direct and very painful personal experience of the dysfunctional eviction process.

    Which is why in light of everything I intend to become an ex-AST LL ASAP!!

icon

Please login to comment

Zero Deposit Zero Deposit Zero Deposit
sign up