Rachel Reeves considering charging CGT on sale of main residence?

[Another76543]

It’s being reported today that Reeves’ latest idea is to tax homeowners on the capital gain made on the sale of their homes, where that home is above a certain value. From The Independent

“Rachel Reeves is considering hitting the owners of high-value properties with capital gains tax when they sell their homes as part of an attempt to fill a £40bn hole in the public purse.
The chancellor is said to be looking at ending the current exemption from capital gains tax for primary residences as she seeks ways to raise cash in the face of dire warnings about the state of the public finances - a move that would be seen as a "mansion tax".
Such a move would see higher-rate taxpayers pay 24 per cent of any gain in the value of their home, while basic rate taxpayers would be hit with an 18 per cent levy.

Sources told The Times that under proposals being considered for the autumn budget, the private residence relief would end for properties above a certain threshold.
The threshold is said to still be under consideration…….. “

There are plenty of sources that reported the possibility of an annual property tax to sit on top of council cil tax for higher value homes. Not sure how you’ve missed them?

However, it’s all kite flying - the bigger issue is that none of the fiddling around with property taxes will touch the sides of the £60 billion black hole that this government has created in 14 months. And now commentators are drawing parallels with the 70s when, under Labour, we had to be bailed out by the IMF!!

www.bbc.co.uk/news/articles/cm2k1m56xgjo

Will she give refunds or credit to those whose homes have gone down?!

Well during the poll tax I lived in Wandsworth and technically the council owed us money. They decided to charge us zero.

So no you won’t be getting paid

I would certainly hope that you'd be able to offset any other capital gains you've made against that loss, although that's a bit of an edge case to eg sell shares at the same time as you sell your home at a loss.

Then again, treating people consistently wouldn't give Labour maximum satisfaction in punishing the rich, so possibly not.

Welfare cuts should be the first step. After all this is the area growing out of control.

Once implemented then look at taxes.

However, way things are going the IMF will be called in and they won't have a choice what actions they take.

Good point!!

Yes exactly not all privately owned property goes up in price. For example like everyone with the cladding issues who lived in fear and couldn’t sell their flats post-Grenfell tower disaster?

If you are talking about it being a capital loss, assuming the current rules around it don't change, any capital loss would roll forward and be available to offset the next capital gain.

so if a gain was made on the next house sale there would be a loss to offset against it.

The planet that is paying for everything.

Totally agree that this would be yet another tax on London and the commuter belt.

Those on higher salaries also tend to be those with the skills (and experience) sought by other countries. It does make them much more mobile.

In research published in 2023, The UK came out as the 7th most expensive place to live in Europe. Due to globalization, corporate jobs in Europe increasingly use English as their working language, which makes it even easier than before for Brits to secure well-paid jobs abroad, even if they don’t arrive with the local language. Locals, who do not speak English, now loose out on these kind of jobs to foreigners with fluent English.

The Belgians, for example, live so much better than the average Brit. Their housing is affordable; their food is some of the cheapest and best in Europe; very, very cheap, state subsidized child care and their education system is also stunningly good. The average Belgian teenager speaks at least three languages (Flemish (i.e. Dutch), French and English.

Switzerland, whilst more expensive than the UK, does have some of the highest salaries in Europe. On average you would live more comfortably than in the UK. If you chose to work in Switzerland but live just over the border in France or Germany, you really can live the high life and on only one salary if you so choose.

In the UK, Private school fees are often a consideration for higher earners (and school fees have risen much higher than inflation. An expat job abroad might well include the cost of private school fees (if you wanted your children to be taught in English). In many European countries, however, private schooling (in the local language) is not at all common and where it does exist it is often a fraction of the cost of the UK (about €1,000 per child, per year - as they tend to be run on a not for profit basis). With the local schooling option, (private or not) your child ends up fluent in at least one other language.

Great post