Changes to landlord Capital Gains Tax rules

This means that landlords planning to sell their property could face changes in their tax liabilities and FHL owners need to be aware of how the abolishment can affect them.  

The changes are as follows: 

• The Capital Gains Tax (CGT) rate for higher rate taxpayers will reduce to 24% from 28% from 6th April 2024 
• The CGT tax free allowance (Annual Exempt Amount/AEA) will reduce from £6,000 to £3,000 from 6th April 2024, with the amount for trustees reducing to £1,500. 
• Multiple dwellings relief is being abolished from June 2024 
• The Furnished Holiday Letting (FHL) scheme is being abolished from April 2025 
• Increased fines for right to rent scheme non-compliance 

Higher rate Capital Gains Tax rate reduced 

The Spring Budget 2024 announced that the higher rate for CGT on residential property sales would reduce from 28% to 24% from 6th April 2024. 

The main CGT residential property rate, and non-residential property rates are not changing. 

Capital Gains Tax Annual Exempt Amount reduced 

The Annual Exempt Amount (AEA) for CGT is reducing from 6th April 2024. The amount for individuals will be £3,000 for the 2024/25 tax year and the amount for trustees will be £1,500 for 2024/25. 

Multiple dwellings relief abolished 

Multiple-dwellings relief will be abolished from 1st June 2024, as announced in the Spring Budget 2024. Multiple dwellings relief applies when you buy more than one dwelling in a single transaction, and results in a lower rate of Stamp Duty Land Tax. 

Furnished Holiday Letting (FHL) scheme abolished 

The Furnished Holiday Letting scheme is being abolished from 6th April 2025. The spring Budget 2024 announced that the FHL scheme will be abolished, with the implementation of anti-forestalling rules will apply from 6th March 2024. The implications for FHL owners can be found here. 

Right to rent scheme non-compliance fines increased 

From April 2024, the fines for landlords who do not comply with the right to rent scheme have increased to: 

• First breach fine from £1,000 to £10,000 per occupier  
• Repeat breach fine up to £20,000 per occupier 

How TaxAssist Accountants can help

We would be delighted to help you understand how the changes impact your tax position and calculate the impact these changes have on your tax position. For more information, please contact us online here or call our team on 01223 414033.

Last updated: 28th May 2024