One of the big announcements in the Autumn Budget was funding for affordable houses and leaseholders affected by the cladding crisis. Chancellor Rishi Sunak also affirmed an extension to the window for paying capital gains tax when selling property in a Budget that was thin on property commitments.
Capital gains tax timeframes extended
The timeframe for people to notify and pay Capital Gains Tax after selling UK residential property will extend from 30 days to 60 days as of today, October 27, 2021.
This period will also be extended from 30 to 60 days for non-UK residents selling property in the UK. When UK citizens sell mixed-use property, legislation will clear that the 60-day payment window will only apply to the residential portion of the gain.
Cladding
The chancellor confirmed a £5 billion spend on cladding, funded by a levy on larger builders in order to put right hundreds of tower blocks following the Grenfell tragedy four years ago.
The new Residential Property Developer Tax (RPDT), which was first announced in February, will help to pay this. In April 2022, the new tax will take effect. It will be levied at a rate of 4% on yearly developer earnings of more than £25 million. According to the government, RPDT would “ensure that the largest developers contribute a fair share to help pay for building safety rehabilitation.”
Green Homes Grant
Measures to make the country’s homes greener were announced, but the Chancellor also revealed that £3.9 billion will be allocated to decarbonising homes, which many lettings and sales agents may be directly involved in as minimum EPC standards are implemented first for rented properties and then for owner-occupied homes.
It’s encouraging to see the Chancellor set aside funds to assist homeowners in making their homes more energy efficient, but the current support packages are still a drop in the ocean in terms of what needs to be done, and more can and should be done to support the move towards greener homes and widespread consumer adoption.
Brownfield sites to be used for housing
Sunak revealed a further £1.8 billion earmarked to increase housing supply.
This includes £300 million locally-led grant funding that will be distributed to local authorities to unlock smaller brownfield sites for housing and £1.5 billion to regenerate underused land and deliver transport links and community facilities, unlocking 160,000 homes in total.
Local Housing Allowance Rates
Local Housing Allowance rates will be frozen for 2020/21, thereby maintaining the previous freeze adopted by the government earlier this year. As a result, the gap between how much low-income private sector tenants get in housing assistance and real market rents would widen.
