Capital Gains Tax

[AtW]

ha ha

Tax rises could prompt 'fire sale' of second homes and shares - Telegraph

Good - the recover won't come until house prices deflate to reasonable levels.

[BlasterBates]

The Liberal Democrats hope the CGT shake-up will be included in the first Budget. But George Osborne, the Chancellor, thinks more work is needed and has asked for more options to be drawn up.

The Treasury said: "There are a range of possible options on CGT to fulfil this aim and no decision has yet been taken on one option. It will be important to take the time to get this right."

....ha ha...... a stay of execution

if it doesn't get in this budget, I reckon it'll be dead....with a "yeah yeah Nick we'll do it next year"

[BlasterBates]

We'll have to wait and see, I found that before both systems were OK, i.e. high tax with taper relief, low tax without taper relief (designed actually to take more) however the current proposal is just basically digging into your real savings. For me it would mean living as a tax exile after retirement, , with a huge "no-entry" sign over the UK.

[Gonzo]

Well I haven't heard about taper relief (i.e. inflation).

Me neither but someone is going to have to do something about it before too long.

Taxing the increase in value due to inflation is so thoroughly unjust I don't understand why more of a stink has not been kicked up over it.

[BlasterBates]

yes nothing like a spreading rumour, to get those prices tumbling:

Landlords

[TimberWolf]

Looking on the positive side. If house prices do drop, the capital gain will be less. Less tax to pay. Boomed.

[BlasterBates]

Well I haven't heard about taper relief (i.e. inflation). If this goes through as it is it penalises those whose savings are in shares.

I calculate that taking into account inflation they'll basically take what ever your asset is a take portion of it. If I sell my share portfolio in 20 years after I've paid the tax, if I'm lucky in real terms it will be basically the same amount. On the other hand home owners with homes who've risen by several hundred thousand pounds pay no CGT. That's just special interest groups getting their politicians to take money off another special interest group (share owners).

[Gonzo]

Have you read the article?

Tax rises could prompt 'fire sale' of second homes and shares - Telegraph

Headline

Tax rises could prompt 'fire sale' of second homes and shares

First paragraph

A 'fire sale' of second-homes, shares and fine art is expected as investors try to beat widely-expected leaps in capital gains tax (CGT) and VAT.

VAT? How?

Further down the article

Estate agent Knight Frank confirmed it had taken a number of calls from second-home owners contemplating a quick sale but said it was "far too early" to tell if there would be a rush of property sales and that many vendors were gambling on the Chancellor introducing the higher rate of CGT from April 2011.
Liam Bailey, head of residential research, said: "The initial response from the industry has been to suggest there will be a mass sell off of investment and second homes. This is unlikely.

However most investors in residential property are in the market for the long term. With interest rates so low, rental yields have become a more important driver of demand rather than short term capital price growth."

He added that 70 per cent of second-home owners intended to retire to their other property making it unlikely they would rush to sell.

However, Stephen Herring, senior tax partner with accountants BDO, said: "It is unlikely that many will be able to sell quickly enough to benefit, although it is possible we will see home owners become keen to finalise sales that have already been teed up.

So probably not going to happen then. Who writes this guff?

I am OK with capital gains being taxed the same as income, with allowances for entrepreneurs, long term investors and inflation. Sort of like the old system really before Darling ****ed about with it.

[Moscow Mule]

I think there's a bit of faulty logic there - if you're renting out a second home and are gaining an income from it, why would you want to sell it now because of the threat of CGT on a future sale?

Perhaps some folk will, but I can't see every landlord in the country suddenly wanting to sell up.

[BlasterBates]

ha ha

Tax rises could prompt 'fire sale' of second homes and shares - Telegraph

Looks like after a fire sale of second homes, the housing market just might get pushed over the edge. Coupled with severe spending cuts, should shove a few Lib-Dem voters into grinding poverty. There's no such thing as a free lunch. The "lets pay for the huge deficit by targeting a non-Lib Dem voting group" won't work

[rootsnall]

Is anyone "outraged" at the increase.

Or is this a non-issue?

I suspect it's reduction to 18% was really a measure to help support BTL and hence the property market. I'm sure there will be many ways around it for wealthy people, but your PAYE middle class mug will be hit with a bigger tax bill.

[BlasterBates]

...well it was 40% before but with a £10,000 threshold, so normal people wouldn't have to pay it. That threshold will be mostly removed.

[Churchill]

I would think that anyone who let's their "outrage" be known is going to be towards the top of any investigation list...

[AtW]

It was 40% for a long time - it should have never been put (just 2 years ago) to 18%.

What's outrageous is that fking Brown effectively removed taper relief for long term investors - that was probably one good thing he did 10 years ago and scrapped it.

New Govt mentioned something like having different rates for business and non-business assets, but I'd expect everyone to get hammered as they need all the money they can get.

[BlasterBates]

Is anyone "outraged" at the increase.

Or is this a non-issue?