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Budget 2018: Landlords hit with £470m private residence relief cut

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  • 29/10/2018
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Budget 2018: Landlords hit with £470m private residence relief cut
Landlords are likely to be hit with a tax rise with a key relief set to be removed.

 

The changes mean landlords will only be able to take advantage of private residence relief on Capital Gains Tax (CGT) if they are living in the property with a tenant.

Delivering the Budget, Chancellor Philip Hammond said it would be eliminated for people not using the home as their main residence.

“CGT relief will only be permitted for landlords where they are sharing occupation of the property with a tenant,” he said.

Figures from HM Treasury suggest it will earn around £470m between 2019-20 and 2023-24 for the Treasury – hitting an estimated £150m in 2023-24.

 

‘Better target relief’

In its Budget documents, Treasury said it was making the move to better target private residence relief at owner occupiers.

“From April 2020 the government will reform lettings relief so that it only applies in circumstances where the owner of the property is in shared occupancy with the tenant,” it said.

“The final period exemption will also be reduced from 18 months to nine months. The government will consult on these changes.

“There will be no changes to the 36 months final period exemption available to disabled people or those in a care home,” it added.

 

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