Landlords and second homeowners wouldn’t have failed to notice the forthcoming change to the Capital Gains Tax allowance announced in the Autumn Statement towards the end of last year.
Chancellor Jeremy Hunt announced that the current allowance of £12,300 is being halved to £6,000 from April 2023 and then cut again to £3,000 from April 2024. That could mean an increased tax bill for many property owners planning to sell this year, but is there anything that can be done about it?
Andrew Parker, Auctioneer and Managing Director at SDL Property Auctions have taken some time to review the changes.
As we know, Capital Gains Tax is charged on any 'gain' or profit you make when you sell or dispose of assets, such as personal possessions, a second home or shares that aren't within an ISA. So immediately, landlords and second homeowners are at risk of paying more come the new tax year. Commercial properties may also be affected if you lease out any part of your property or use your home as a business premise.
What it comes down to right now is the timeframe. If you are looking to sell a property this year, then it is advised to do it quickly and complete before the end of the current tax year. This is where a sale by auction comes in.
With completion times on the open market taking up to six months and the risk of fall-throughs at any point, an auction is the best method for ensuring a secure sale. By selling in an auction, you get a legally binding contract on the fall of the hammer with a fixed completion set for only 30 days later. That means if you sell in January or February, you can hand over the keys and have the proceeds in your account before the end of March.
Auctions aren’t only limited to run-down properties or those in need of repair either. All types of property can be sold by auction including vacant or tenanted residential properties, land and development opportunities and commercial and mixed-use units.
In a time of economic uncertainty, and with the market looking more heavily skewed against multiple property owners, auctions provide a secure sale at the best price. With under 80 days left until the end of March, choosing auctioning means you’d be sold fast and faff-free.
