Experts vote for CGT rate increase in 2011
Grant Thornton head of tax Francesca Lagerberg has added her voice to calls to implement any Capital Gains Tax rate changes at the beginning of the new tax year in April 2011.
With Tory backbenchers threatening to rebel over the issue, CGT has provoked political and technical controversy.
“CGT changes are really significant on how to plan for next year,” Lagerberg told a seminar at the recent CCH user conference. “If [the rates] are going to be aligned with income tax, shifts into capital will be less advantageous.”
From the promises in the Liberal-Conservative coalition agreement, Lagerberg expects to see the CGT rate increase, but is in the dark with the rest of us on what the rate is likely to be, and how the government will go about implementing it.
“Maybe it will be 40%, but not on everything. They want to protect true business activity and may have less relief on non-business activity. What’s business or non-business will be absolutely vital. There will be support for entrepreneurial activity, if you are genuinely trading.”
According to Lagerberg, “The big issue is the starting date.” Two of the possible options are “rubbish”, she said, and one offers practical advantages.