£150m

The Daily Telegraph - Your Money - - MONEY - Adam Wil­liams

claim up to £40,000 in let­tings relief when a prop­erty is sold, cov­er­ing the pe­riod when the prop­erty was rented out. This is po­ten­tially worth £11,200 in saved tax. How­ever, from April 2020 only owners who re­main in the prop­erty while it is rented out will re­ceive the tax break. The Trea­sury es­ti­mates that land­lords will pay £150m in ex­tra tax each year by 2023-24 as a re­sult. A con­nected change af­fects “prin­ci­pal pri­vate res­i­dence” relief and will also pe­nalise land­lords and sep­a­rat­ing cou­ples from 2020. At present, the last 18 months of prop­erty own­er­ship are ex­empt for CGT pur­poses, re­gard­less of whether the owner was liv­ing in the prop­erty at the time of sale. The ex­emp­tion pe­riod will be cut to nine months. Neil Lan­caster of Blick Rothen­berg, an accountancy firm, said this change would pose a prob­lem for sep­a­rat­ing or di­vorc­ing cou­ples whose for­mer fam­ily home was be­ing sold. The sale could now be li­able for CGT if the home re­mained un­sold af­ter nine months, he warned. “For many peo­ple nine months is not enough time to sell a prop­erty. This will lead to un­nec­es­sary com­pli­ca­tions when cal­cu­lat­ing the cap­i­tal gains on the dis­posal of prop­erty,” he said.

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