MP Supports RLA Proposal to reduce CGT

An RLA recommendation – to reduce Capital Gains Tax (CGT) paid by landlords when selling their rented home to sitting tenants – is being proposed as an amendment to the Finance Bill.  Clause 72 of the Bill reduces CGT to 20% but not for the sale of residential property which remains at 28%.  MP Kevin Hollinrake is tabling an amendment to extend the 20% CGT rate to private landlords when they sell their rented property to a sitting tenant.

Given the recent attack on the Private Rented Sector by Chancellor George Osborne, the RLA believes more and more landlords will want to exit the market as renting becomes financially unsustainable for them.  Interestingly, 77% of landlords would consider selling their property to their tenants if the CGT was lower.

Mr Hollinrake says the amendment will support the Government’s home ownership agenda while at the same time offering landlords a route out of the sector minimising the financial hit. The amendment also includes safeguards to prevent such a tax change being abused. He is now lobbying for support among fellow MPs.

The RLA encourages members to write to their MP asking them to back the amendment when the Finance Bill is debated later this month.

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