Tag Archive: property
Capital Gains Tax causes a lot of confusion in the United Kingdom. Currently, what are you required to pay capital gains tax on and how much are you required to pay? James Carruthers, Associate, explains the basics.
What is Capital Gains Tax?
Capital Gains Tax is a tax on the sale profit when you dispose of something that has gone up in value. Disposing of something means:
- a sale
- gifting or transferring it to someone else
- trading it in exchange for something else
- getting compensation for it i.e. an insurance pay out
Capital Gains Tax in Property
Let’s say you bought some land for £50,000 and subsequently sold it for £150,000; Capital Gains Tax would be due on the £100,000 profit. Don’t worry, you only have to pay if you make a profit when disposing of a property that isn’t your home. For example:
- buy-to-let properties
- business premises
- inherited property
It is very common for property to be transferred as inheritance. When inheriting an asset, any application Inheritance Tax will usually have been paid by the deceased estate, however, you may be required to pay capital gains tax if you later dispose of the asset you inherited.
What am I Likely to Pay?
The amount you pay depends on the level of your annual taxable income, the level of profit/gain you have achieved, as well as any tax reliefs that you may be entitled to.
If you’re a higher rate taxpayer, Capital Gains Tax is equal to 28% on any profit/gain from residential properties which are not your main residence, and 20% on any profit/gain from other assets. You may still also need to pay capital gains tax on assets which sold at a loss if your total taxable gains for the year exceed the tax-free allowance.
For any property assets that have been owned for a long period of time, any Capital Gains Tax due will be based upon the property’s value as at the 31st of March 1982 rather than the date of acquisition.
Reliefs from Capital Gains Tax are available to help defray the amount of tax that is to be paid; including the likes of Entrepreneurs Relief and Retirement Relief.
How can we help?
If you have disposed of a property asset using any of the aforementioned methods, you need to submit a market valuation of the property which will be reviewed by the Valuation Office Agency (VOA) on behalf of Her Majesty’s Revenue and Customs (HMRC).
It’s therefore vital that robust valuations are prepared that can stand up to scrutiny under the VOA review process, and that provide an appropriate depth of evidence in which to challenge or raise a dispute if necessary.
At George F. White, we have a skilled team of RICS-Registered Valuers who have the experience and expertise of preparing high standard Capital Gains Tax valuation reports that accord with the necessary industry standards.
For more information about our commercial property services, please visit our commercial property pages.
The Residential Agency team in George F. White Alnwick, have experienced an increase of 40% in year-on-year agreed residential sales despite there being a decline on a national scale for a 10th successive month (May 2019: Residential Market Survey, RICS).
A regional breakdown shows that property transaction volumes have picked up in the North of England and Wales.
Why the increase in residential sales?
Discussing the increase in sales in Northern England, Gemma Miller, Residential Sales Manager at George F. White in Alnwick, said: “We have seen a dramatic increase in the number of residential sales year on year. Much of the buyer interest has been from people involved in North East business, investing within the region, which is encouraging.
There has been a huge influx of investment in the North East from major house builders such as Taylor Wimpey and Bellway and this has been recognised by national retailers looking to move into an area that is becoming more and more popular for young families. If we take Marks and Spencer as an example; despite looking to close 100 stores by 2022, they are going ahead with their move into the market town of Alnwick, perhaps partly due to the residential development and perhaps due to the plans to dual to A1. When a high profile retailer moves into an area, others tend to follow.”
In a competitive market, the team have focused on providing a tailored service to be centred around offering a quality service to the buyer and seller and introducing them in accordance to their demands, meaning they are often able to sell prior to marketing.
Gemma continued: “We have recently seen an influx of enquiries from people who have tried selling their properties online, only looking to return to the traditional high street estate agents. This is particularly true to those selling more expensive homes. We understand home owners have been persuaded over the last few years by the online estate agents with a promise to sell homes quickly, and at a fraction of the cost of their High Street rivals. But, as hundreds of people put their homes on the market this summer, some internet agents are struggling, and their share of the market has stalled. E-Moov went into administration in December 2019 followed by House Network in 2019.
Often online agents operate from nationwide call centres so in reality have limited local knowledge and often don’t know the specifics of the local market. Traditional Estate Agents, like George F. White, are dealing with more properties and more buyers and we have a firmer grip on the buyer demand levels and what buyers have very recently offered on (and paid) for similar property.”
With more buyers lined up, George F. White are always looking for more quality properties and have recently recruited to ensure they continue to meet client needs. If you would like to discuss the sale of your property or are looking to purchase in Northumberland, please contact our Alnwick agency team on 01665 603581 or visit their website www.georgefwhite.co.uk.
Victoria Linsley explains why you shouldn’t wait for Spring to sell and why our advice is that now is the time to launch your property to the market.
We’re hoping that there’s light at the end of the wintery tunnel and that spring is within reach. Flowers are breaking through, the grass us turning and we live in hope of brighter weather. However, this year’s no different from other years… again, we ask sellers holding out for the magic of Easter/spring; why wait to compete against a flood of new property in the market?
Our general advice is that now is as good a time as any to sell your property. However, we still hear the same comments from cautious vendors. They feel the best time of year to market their property is the spring.
What’re are keen to stress is that buyers don’t wait until the spring before starting their search. Generally, buyers will also be selling, and will tend to move for reasons other than because they fancy a change. The most common reasons we see for house moves, in the present climate, is to be nearer to family, relocation due to work or up/downsizing because the property no longer meets their requirements. These factors are present at all times of the year, which tells us that there’s no particular merit in waiting for good weather (if indeed it ever arrives!?) especially when that’s when you will have the highest levels of competition.
There’s a certain amount of caution in the market, given the political situation, however, whilst funding is still readily available, buyers will still move and we’re experiencing a lot of activity day-to-day in terms of enquiries, viewings and offers.
That said, we do acknowledge how important it is to wait for the right time for you. If you rush your property to the market without preparing, it may not be presented in the best way and when the point comes to agree on, or complete, a sale you may have a change of heart, delaying or damaging the marketing process.
We’re amazed by the amount of scaremongering in the media when it comes to property prices and state of the market! This often stems from reports on the London housing market; something quite different from that of which we are accustomed to. Even though there’s a slight decrease in viewing numbers, the number of offers being received is still comparative to this time last year and there’re a number of people enquiring on a daily basis who can not find what they are looking for due to a lack of properties being offered for sale.
We’re always happy to chat over ideas and give general advice if you are thinking about selling or letting your property, please feel free to contact our friendly and professional team at George F. White, Harmire Enterprise Park, Barnard Castle on 01833 690 390.
We invite you to join us at our GFW Road Show.
Our agricultural, planning, architectural, agency and commercial teams will be discussing the opportunities for rural businesses to improve performance and reduce risk within these uncertain times.
- Characteristics of top performing farms
What they look like and how to get there
- Buying and selling land
What the future holds in these uncertain times
- Your land, your rights
Dealing with utility access and maximising your compensation
- Planning and Development
Your opportunities, now, and in the future
This is an excellent opportunity for you to understand the current state of the rural business industry as well as meeting our team and receiving expert advice in regards to your next step.
Dates and Venues
Mon 18th Feb – Northallerton Rugby Club, Northallerton DL6 2QF
Tue 19th Feb – Sedgefield Racecourse, Sedgefield TS21 2HW
Wed 20th Feb – Alnwick Rugby Club, Alnwick NE66 1BE
Mon 25th Feb – Duns Rugby Club, Duns TD11 3QQ
Mon 25th Feb – Pocklington Rugby Club, Pocklington YO42 2LP
Tue 26th Feb – Tynedale Rugby Club, Corbridge NE45 5AY
- 18.00 Welcome
- 18.30 Presentation
- 19.30 Light Refreshments
If you would like to attend, please RSVP by following the link.
For more information, please email Emma Gillespie-Payne or call 01665 600164.