Wednesday, 26 May 2010

An open letter to Mr Grant Shapps, Minister for Housing and Local Government

Today we have sent this letter by email to Grant Shapps (pictured) the Minister for Housing and Local Government:

Mr Shapps, work with landlords and letting agents throughout the UK. We have received a considerable number of emails and telephone calls from landlords concerned that your Government may impose significantly higher Capital Gains Tax on the sale of rented properties.

We understand that the proposal is to link CGT rates to income tax rates on the sale of non business assets. As you are aware there are around 1 million private residential landlords who own and manage around 3.5 million homes in the UK. These landlords are currently required to submit returns to HMRC as a business. Media speculation indicates that your Government may view owning and managing residential property as a non business asset.

On behalf of landlords we work with we are seeking clarification that the Government will treat the ownership and management of privately rented residential property as a business and that any changes in CGT rates will reflect that. The loss of taper relief which the previous Government removed has already made owing and managing property less attractive. We believe that linking CGT to income tax rates will seriously damage an industry which is vital to this country and will force many landlords to leave the industry and seriously deter potential new landlords.

We are aware that the National Landlords Association are running a campaign to raise awareness of this issue and encouraging their members and others to contact their MPs but time is too short before the emergency Budget to galvanise landlords into concerted action. Owning rental property is business activity not speculative investment and we ask that you confirm that your Government agrees with this point. Furthermore, we request that you bring the legitimate concerns of landlords throughout the UK to the attention of the Chancellor as he prepares the emergency Budget and encourage him to act accordingly.

A copy of this email will be posted on our Blog. Any response that you wish to make will also be posted on our Blog.

Kind regards,

Sean Kearns

Managing Director

NetRent Ltd