Jasmine Birtles is GBN Membership’s money expert. Got a pensions or retirement question you’d like her to answer? Email [email protected].
Question:Hi there. I bought a buy-to-let to support me in retirement. I’ve seen reports about capital gains tax changes. What could it mean for my investment?
Jasmine replies:We’re all worried about what could be thrown at us in this government’s first Budget.
Capital gains tax is one that has been heralded as most likely to go up, so it’s not surprising that you are concerned about your property.
I checked with Shaun Moore, tax and financial planning expert at Quilter, about this and he said: “As a buy-to-let investor, it’s natural to feel concerned about potential capital gains tax (CGT) changes ahead of the budget.
“However, it’s essential not to make hasty decisions based on speculation.
“While the government may consider adjustments to CGT as part of their broader tax strategy, there’s no certainty that any changes will directly impact your buy to let investment, especially without knowing the full details of your financial situation.
“Current rumours suggest that the Chancellor may align CGT rates more closely with income tax rates, which could increase the tax burden on gains from property sales.
“There are also discussions around reducing or potentially abolishing the CGT annual allowance, which would mean investors could be liable for tax on a larger portion of their gains.
“However, it’s important to remember that these are just rumours.
“Even if changes are implemented, the timing and scope are uncertain. For instance, some proposals may only affect high-net-worth individuals or those with significant capital gains.
“Ultimately, the best course of action is to consult with a financial adviser who can help you assess the potential impact on your specific situation.
“This way, you can make informed decisions rather than reacting to unconfirmed reports.”
I think it’s a wait-and-see game.
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There have been so many assumptions about what the Chancellor will announce in the Budget that it’s quite possible that we will all be pleasantly surprised when it finally comes round.
It’s quite likely that it won’t be as bad as we have all been predicting. Let’s hope so!
Whatever does happen, though, make sure you don’t do anything too quickly.
Frankly, with something as big as an investment property it’s worth getting some professional advice before you do anything major with it, or with any of your other investments.
Jasmine Birtles is a personal finance expert, TV and radio presenter and author of 38 books. Her website, MoneyMagpie.com, covers all aspects of personal finance from money-saving and money-making ideas to investment and pensions information. She is a keynote speaker at conferences around the world.