CAPITAL GAINS TAX RECEIPTS SET TO SOAR

Mar 16, 2020

The lifetime limit on qualifying disposals eligible for the lower 10% capital gains tax rate was reduced in last week’s Budget, from £10 million to £1m. Which means that the changes to Entrepreneur’s Relief are being tipped to contribute towards a large rise in capital gains tax receipts over the coming years.

Capital gains tax receipts are expected to reach around £15.7 billion in 2023/24 – up from £3.9bn ten years’ earlier in 2013/14.

Other contributing factors include the phased changes to mortgage interest relief, which has forced some landlords to sell buy-to-let properties. Changes to letting relief and the final-period private residence relief exemption, both of which kick in for 2020/21, will boost the Treasury’s coffers.

Spouses or civil partners can share ownership of assets to reduce their bills, as can staggering the sales of assets across tax years.

Afford Bond Director, Paul Edwards, commented: “It’s easy to be caught out by capital gains tax and many are unaware of the full implications. Those selling or giving away property or investments often end up paying more than they need to either because they have not sought professional advice, or have left planning a little late. Much of the projected increase in CGT receipts will be down to the slashing of entrepreneurs’ relief.”

If you would like to speak to one of our tax experts, or need help with your corporate finances, particularly during the current business climate, please email Paul.Edwards@affordbond.com or complete the Contact Us form on our website.

Other posts you might like:

Vacancies

We are always on the lookout for talented individuals to join our teams in Nantwich, Wilmslow and Manchester.

If you are interested in pursuing a career in the Accountancy Profession,  please send us your CV and covering letter.

read more