Capital Gains Tax on House Sales, Do Not Be Caught Out

Many people it appears are either unaware, or unsure of the regulations but as the housing market is gaining momentum again, now is a great time to look at the current situation in respect of selling a house.
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    Disclaimer: This article is based on legislation which was correct at time of publishing on August 11, 2020
    This page was last updated on August 17, 2020

    We love receiving calls and emails from clients, and it’s great to be able to help out. This has been the case recently, with 3 or 4 individual enquiries on the same subject, each concerning the new Capital Gains Tax reporting regime, introduced in April 2020.

    Many people it appears are either unaware, or unsure of the regulations but as the housing market is gaining momentum again, now is a great time to look at the current situation in respect of selling a house.

    The headline is that under the new rules, any taxable gain must be reported and the tax paid within 30 days of completing the sale.

    Of course, we were able to assist our clients not only with advice, but also with the tax calculation and handling the compliance, it’s all part of our service. So, if you, or anybody you know is selling a house, please ask them to get in touch, we can help.

    On the subject of property, do you know about Multiple Dwelling Relief?

    Basically, if you buy a property that has two separate dwellings on it, a granny flat or staff quarters for example, the Stamp Duty can be significantly reduced by claiming for Multiple Dwelling Relief.

    And how about the Stamp Duty Land Tax Holiday?

    Another area that seems to be causing some confusion is the recent introduction of a Stamp Duty ‘holiday’, the term holiday is in fairness quite misleading in itself, the duty will still have to be paid on the taxable portion of properties valued at over £500,000 and properties under £500,000 where the 3% surcharge applies, so the precise benefit will actually vary, dependent upon certain qualifying factors.

    However, HM Government estimates that 90% of all buyers will pay no duty at all!

    Thank you, Rishi.

    The holiday is intended to mitigate problems faced by furloughed workers in getting a mortgage and ease the predicted downturn in 2021 property sales.

    As ever, our team are always happy to advise on any issues concerning residential, buy-to let or commercial property so it makes sense to get in touch before you buy or sell a property, after all… ‘You don’t know what you don’t know’.

    biggerpicture@staging5.buttmiller.co.uk

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