Tax changes to private residences for 2020/21.
From 6 April 2020, HMRC is proposing three significant changes which will potentially increase the capital gains tax paid on the disposal of any residential property by an individual.
These changes seek to raise extra revenue from the disposal of residential properties and to collect these taxes more quickly.
For many of the 1.2 million residential property disposals each year, there will be no liability having been occupied throughout the period of ownership as the owner’s main residence.
If, however, you have a property which was once your main residence and you either let it out or have retained it for other reasons, these changes will affect you.
Working away, divorce or separation and other common issues could also see your entitlement to full private residence relief affected, meaning some of the rule changes could impact you.
If any of the above applies to you, these changes are likely to result in you having to pay significantly more capital gains tax if you sell or transfer these properties on or after 6 April 2020.