Residential property taxes

Whilst numerous changes made to residential property taxation over recent years, the full force of these changes has yet to materialise, particularly with regard to the restrictions on mortgage interest relief for individuals, which is being tapered over four years.  Those with large residential property portfolios with mortgages may be affected.  In addition, there has been the replacement of wear and tear allowance, with relief for the cost of replacements allowed instead. 

Top tip:

The cost to the UK Exchequer of “main residence relief” is estimated by HMRC at over £25 billion each year.  Whilst this relief is hugely valuable (it can provide 100% relief against the gain arising) the actual position will depend on the circumstances.  Quite often, an unexpected gain may arise.  This can arise in the case where the house has not been fully occupied as a residence, for spouses who separate, or for those who miss the opportunity to make an election to nominate which property is your main residence. 

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