Buy-to-let snubbed in Osborne’s budget capital gains tax cut
Friday 18 March 2016
The 2016 budget means buy-to-let landlords will take yet another battering, it has been predicted.
If the introduction of the stamp duty hike next month didn't damage George Osborne's reputation enough, his latest move is certain to lose him more friends.
A capital gains tax surcharge for landlords selling property was introduced as part of the Chancellor's proposals.
Making matters worse, other investors will see a reduction in the tax, with buy-to-let apparently being made exempt.
From 6th April , capital gains tax will be cut from 18 per cent to 10 per cent, a move Osborne says is intended for investors to "keep more of the rewards when the investment is successful".
But for those in the buy-to-let sector, there will be an 8 per cent surcharge, meaning they are being taxed at higher rates.
This is to encourage people to put money into businesses, rather than property.
David Cox, from the Association of Residential Letting Agents, said the move completes a hat-trick of direct attacks on buy-to-let landlords.
He added: "The sector has been punitively taxed, with stamp duty on buy-to-let properties, mortgage interest relief and now capital gains tax changes. It’s an outright assault on the sector.”
Tina Riches, a tax partner at accountancy firm Smith & Williamson, said: “The Chancellor’s plan to reduce capital gains tax rates are a very welcome encouragement for entrepreneurs and others investing in businesses – but yet another disappointment for those invested in residential property who fail to benefit from this latest initiative.”
The move to penalise landlords yet again is timely, given the recent predictions that up to one million second-home owners will look to offload their properties over the next five years because of the stamp duty tax set to come into force on 1st April.
Maybe Osborne is listening after all, but rather than abate, has decided that even more money could be made from the misery of landlords.
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