A campaign to reduce Capital Gains Tax paid by landlords when selling their rented home to sitting tenants has won the backing of Conservative MP Kevin Hollinrake, the founder of the franchise agency giant Hunters.
The idea came from the Residential Landlords’ Association, which wants the measure to be put into an amendment to the Finance Bill currently going through Parliament.
Clause 72 of the Finance Bill reduces CGT to 20 per cent, except for the sale of residential property where the rate stays at 28 per cent.
The RLA now says Hollinrake is tabling an amendment that would extend the new 20 per cent CGT rate to private landlords when they sell their rented property to a sitting tenant.
“Given the recent attack on the Private Rented Sector by Chancellor George Osborne the RLA believes more and more landlords will want to exit the market as renting becomes financially unsustainable for them” the association says.
RLA research has found found that 77 per cent of private landlords would consider selling their property to tenants if the tax liability was reduced.
Hollinrake, a loyal supporter of the government during his time as an MP, says the amendment will support the government’s wider home ownership agenda while at the same time offering landlords a route out of the sector minimising the financial hit.
The RLA says it will be asking members to write to their MP encouraging them to back the amendment, once it is tabled.