Investors and second homeowners have been handed a welcome tax break in this year’s Autumn Budget.
The threshold at which Capital Gains Tax (CGT) is paid will be increased from £11,300 to £11,700 from April next year.
It means investors or those in the buy to let property market will keep more of the profits they earn from assets they’ve bought and sold.
CGT is paid on most personal possessions worth £6,000 or more, as well as property that isn’t your main home and shares not in an Individual Savings Account (ISA) or Personal Equity Plan (PEP).
If you’re a higher or additional rate taxpayer you’ll pay 28 per cent on gains from residential property and 20 per cent on gains from other “chargeable assets” – assets which attract CGT.
Please note that you don’t pay CGT on a residential property that is used as your primary residence, or on chargeable assets passed over from a spouse or civil partner.
For more information on how second homes are taxed, click here.
For more information on how shares are taxed, click here.
Our specialist team at JW Hinks has many years’ experience in helping individuals and businesses devise comprehensive plans for their future and can provide guidance in calculating future Capital Gains Tax liabilities.