There was a positive voice in parliament for private landlords this week, as an MP argued that they should not have been excluded from a Capital Gains Tax reduction revealed by the Chancellor.
Kevin Hollinrake, a Conservative MP (and co-founder of Hunters estate agents), believes that George Osborne should not have denied landlords a tax break on their property profits in his Budget speech, and argued that the 28% CGT landlords face when they sell their property is one of the highest in the developed world.
When the Chancellor announced the tax cut, he excluded residential property from the tax cut, so anyone who has invested in other assets will benefit from a reduction from 28% to 20% in the higher rate of CGT, and from 18% to 10% in the basic rate.
The RLA recently undertook a research project and found that 77% of private landlords would consider selling their property to tenants if the rate of CGT was reduced, as the current buy-to-let sector has become financially unsustainable for them. With this in mind, Hollinrake is tabling an amendment to Clause 72 of the Finance Bill (which is currently going through the parliamentary process), which aims to extend the new 20% CGT rate to private landlords when they sell their rental properties to a sitting tenant.
In order to garner support for the change, the RLA is encouraging its member to write to their local MP, in order to show their support for the proposed change.
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