Crewe and Nantwich homeowners who currently rent out a property they once lived in could be hit with a hefty tax bill when they come to sell it, a local accountants has warned.
New government legislation due to come in force from April 6 next year could cost an individual £11,200 in extra tax – or double if they are a married couple – when selling a home that was formerly their main residence.
Peter Rossiter, the new tax manager at Barringtons Chartered Accountants in Nantwich, is urging property owners to be aware of the rule changes and how it could affect them.
When a homeowner sells a property they have rented out they may have to pay Capital Gains Tax, which is a tax on any profit made from the sale.
Mr Rossiter, 30, an Aberystwyth University graduate who specialises in corporation tax, personal tax and tax advisory, said: “These are significant changes that will impact on people who currently let out a property that was once their main residence, so it’s vital they are aware of the new legislation.
“Often this can happen when a new couple, both owning property, decide to live in one and rent out the other.
“The last thing a property owner wants when selling their home is a substantial tax bill they had no idea about.
“When the changes come into effect in April individuals could be faced with paying up to £11,200 in extra tax because lettings relief will no longer apply.
“It’s very important that those people who are currently renting out a property they used to live in and are considering selling it in the near future understand the changes and what it means for them.”
For more information about the new property rules call the firm’s office on Beam Heath business park on 01270 623821 or visit barringtons.co.uk
