Capital gains tax remains unchanged.

The government’s decision regarding capital gains taxes has been very well received among landlords.

The government did not make an announcement on the capital gains tax in the budget, despite fears that it would increase to 40% for taxpayers with higher rates.

In January, the Office for Tax Simplification recommended that CGT align itself more closely with income tax rates, in a review commissioned by Chancellor Rishi Sunak.

“This is great news for the UK property market.”

Michael Cook, LRG National Leasing Managing Director, said: “Today’s capital gains tax (CGT) announcement is great news for real estate, especially for leasing agents and their owners, as they play a key role in maintaining a strong and prosperous private leased sector.”

“The CGT increase would have drastically reduced the supply of rental properties and could have caused a large number of owners to sell to exceed CGT’s deadlines and therefore drive tenants out of their homes.”

“It is important that the government avoid implementing too many initiatives that discourage owners from investing in the sector.”

“If they do so, they must simultaneously provide for high-quality rental stocks through alternative means; otherwise, they run the risk of widening what is already a large supply and demand gap, and invariably increasing rents further.”

Meanwhile, Andy Foote, Director of Seven Capital, said: “Landlords and owners of second homes will also breathe a sigh of relief at the news that the capital gains tax will not increase, contrary to the rumors that were circulating before it was revealed budget.”

“This group of people has already weathered multiple tax storms in recent years, and in a period that has proven difficult for many, a tax hike would have potentially pushed them over the edge and forced a further exodus from the market, which in an in turn have an effect on the rental market. Fortunately, for now, this will be avoided.”

About increasing capital gains taxes.

Almost half (48%) of the owners are concerned about the possible increase in CGT.

The recommendation from the government’s Tax Simplification Office would make higher-rate taxpayers pay 40% on the profits they make from buy-to-let and second homes, compared to 28%.

Despite property investors being understandably concerned about these changes, the majority (57%) plan to stick with their investment no matter what, while a quarter (23%) are taking a wait-and-see approach.

Only 13% are considering selling, while less than 1 in 10 (8%) are currently in the process of selling.

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