Chancellor Rachel Reeves has suggested aligning capital gains tax rates with income tax rates, which would significantly increase the tax burden on property owners. Current average capital gains tax bills for those selling property after 20 years of ownership stand at £54,000; however, if the changes go ahead, this could rise by 67% to between £87,000 and £90,000 for properties purchased before 2005, according to estate agent Hamptons.
Rachel Reeves has acknowledged the need for “difficult decisions” on spending, welfare, and tax to address the £22 billion deficit in public finances. As part of her cost-saving measures, the Chancellor has already cut winter fuel payments for 10 million pensioners and scrapped Conservative social care reforms, generating £5.5 billion in savings. Further cuts and tax changes are expected to be announced in her first Budget on October 30.
