Changes to Lettings Relief
Following on from our previous article that detailed the upcoming changes to the Private Residence Relief (PRR) legislation, residential properties which have been let during periods of absence may also qualify for an additional Lettings Relief.
Similar to HMRC’s draft legislation for PRR, the reform for Lettings Relief will take effect from 6 April 2020. The upcoming changes mean that disposals will only qualify for the additional relief if the owner was in shared occupation with the tenant. Therefore, many landlords will no longer qualify for the relief and may see substantial chargeable gains on the sale of their properties.
Where a landlord is in shared occupation, consideration should be given as to whether the letting constitutes a business. If this is the case, the relief may still be denied.
If you think you may be affected by these changes, our EQ Taxperts can review your overall tax exposure and identify opportunities to mitigate the financial impact.
Please get in touch with our Residential Property Taxperts for more information and advice on property taxes.