Buy-to-let investors taking profits on their properties has propelled capital gains tax (CGT) receipts to their highest ever level, revealed official figures published yesterday.
The Treasury received 20 per cent more income from capital gains tax last year, with receipts climbing to £12.9bn from £10.8bn from the previous year, according to HMRC.
A red hot property market sent house prices up 16 per cent, prompting owners of rental homes to sell their properties to book profits.
Accountants at UHY Hacker Young also said the record CGT take was driven by the entrepreneurs relief limit being lowered to £1m from £10m, meaning business owners have had to pay more CGT when selling their firms.
“The last year has seen some entrepreneurs pay seven-figure sums in extra tax they weren’t expecting,” Phil Kinzett-Evans, partner at UHY Hacker Young, said.
The government recently rejected calls to equalise CGT and income tax rates.