13 May Capital Gains
Capital gains, can it work for you when selling an investment property.
For many people raising the money to buy a house at this moment in time is near impossible. That’s why many people over the years have chosen to make the initial purchase with help from a partner or a family member. When coming to sell the property though how will you then be affected by capital gains? Will capital gains swallow up all your profit making the initial investment a bad one, or will it work in your favour to leave your wallet full.
This answer is, capital gains all depends on how much money you make each year through jobs and other income streams.
How much capital gains do I get free per year? the annual Capital Gains Tax exemption amount is currently running at £11,100 per person, basically the tax on the first £11,100 is free, but after this then it can get a tricky. If you pay basic rate tax then capital gains would run at 18% of any profit over that point. If you are on a higher rate of income tax any profit of the initial £11,100 would be charged at 28%.
Each UK resident gets their first house sale free of any tax then after that you will have to begin to pay your capital gains once you exceed your annual allowance.
Sometimes the amount you pay in capital gains would mean you would get less for the property than if you were to sell it to a fast house sale company such as Home House Buyers.
Fast House Buyers operate in a different way to estate agents as they don’t market your property, they just buy it for cash. Fast house buyers can normally complete within fourteen days and cover all fees.
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