UK Landlord Forum / Life

When you sell a property that isn't your main home, you're liable to pay capital gains tax, which can be up to 40%, depending on your annual salary and how much profit you stand to make from your property sale.

When you see the profit that people are making on property ladder, they never deduct the tax. Why is that? Do they not pay tax? So the actual profit they declare is a little deceiving, isn't it?

I just realised all this now.

Has anyone here had to pay tax when selling property?

I dont know if you know but in April 2008 , CGT will be cut from 40% (which is for the first 3yrs you own the property and then 2% less per annum to a minimun of 24%) .

To a 18% flat rate !

However Taper reliefs been scrapped ,  so if you are in it for the long haul after 10 yrs if your a low rate tax payer you'd only have to pay 13.2 % ( 24% High tax payer) I think it was , which applies only to non business assets like what you are doing.

So in away .............. you could be paying more CGT when you sell your buy to let property IF your a high tax payer

But what you where saying about people on PL , it is really misleading .

hmmmm

But really unless you fancy yourself as abit of a 'fat cat' lol then you'll benefit from Alistair Darling's proposal and only have to pay the flat rate of 18%

But its still annoying having to pay tax on a property just because its not your main residence .
I know how you must feel and property developers but think about the people with holiday homes .


Id be annoyed .... but i guess everyone knows that Capital Gains Tax applies when they get a 2nd property

Yeah, I think I posted a thread about the tax rate being a flat 18% a few weeks ago. God, the tax man is annoying some times!! It's especially annoying when i watch irresponsible chavy 15yr old parents reaping the rewards.

I just thought it was odd that on PL they never mention the tax implications. It must take a significant chunk out of their profit.

ah ok sorry ,

yep i guess the figures wouldnt seem as good if the tax was included

More and more people have more than one property, this property is often held joint may be because it has been left to the common wishes of children or purchase, in order to obtain rental income. In order to avoid unexpected tax bill and plan ahead effectively reduce the tax liability on sale before.

Taxpayers who are selling their principal residence before meeting after 2 years our of 5 years rules should consider determine if they qualify for a partial exclusion of their gain.