A survey of UK homeowners has found overwhelming opposition to proposed capital gains tax (CGT) changes on main residences, with respondents saying the reforms are unfair and damaging for home buyers.
The research from Boon Brokers revealed 97% of the 1,000 homeowners surveyed disagreed that applying CGT to main homes is the fairest way to balance public spending. Just under three quarters of respondents (73%) said the proposed changes to CGT would be unfair, with 71% claiming changes would result in homeowners being less likely to sell their main residence.
Main residences are currently exempt from CGT, which is only payable on profits from the sale of second homes, investment properties, shares and other assets. The proposed changes would remove or reduce this exemption for higher-value primary homes, meaning a portion of the profit from selling a main residence could become taxable.
Gerard Boon, the author of the research, said although the exact details on thresholds, tax rates and exemptions hadn’t been confirmed at the time of writing, the introduction of the proposed reform could create a significant shift in how homeownership is treated for tax purposes.
‘If implemented, these changes could alter financial expectations and influence homeowners decisions about when, or if, to sell’, he said.
“The research revealed that UK homeowners are both concerned and anxious about the proposed CGT reform, with most stating the introduction would be unfair and potentially damaging to the wider housing market. Many believe it would discourage property sales, place additional strain on ordinary homeowners, and that the government should instead focus on reducing public spending.
“The prevailing sentiment was clear: homeowners feel they have already paid enough.”
The data provides a strong reflection of a growing widespread view that additional taxing, especially in the form of a main residence, would impose an additional financial burden on individuals who have and are already contributing to the housing market, Boon said.
“As such, these statistics are indicative of a growing concern among homeowners: the perception that the proposed reforms could end up penalising those who have made long-term financial decisions that were predicated upon the existing system.”
This sentiment was consistent across the UK, with respondents from all regions aligning with the view that the proposed changes would be unfair, and if implemented, the reform would most negatively affect homeowners.
The data also revealed insights into how the proposed CGT changes could influence homeowner behaviour and impact the wider property market, with 71% of respondents saying the reforms would make them less likely to sell their main residence.
‘Introducing CGT on main residences could have serious consequences for the housing market’, Boon warned.
“When fewer homeowners are willing to sell, supply will naturally constrict, driving up competition and prices. This imbalance between supply and demand doesn’t just impact affordability, it would risk stagnating the market and placing greater pressure across all levels of the housing market.”
When asked which approach would be the fairest way to balance public finances, 32% of respondents – the largest proportion – stated that the government should reduce public spending rather than raise new taxes.
Opposition to the reforms could also have an impact on voting: 78% of respondents said it would reduce Labour’s chances re-election. ‘This sentiment was consistent across all regions and age groups, indicating broad voter concern about policies affecting primary residences’, Boon said.
“When viewed alongside wider findings on fairness and financial impact, the data suggests that perceptions of the proposed reform may already be shaping public confidence in Labour’s approach to housing and taxation.”
The full research, including questions and responses, can be seen at https://boonbrokers.co.uk/capital-gains-tax-reform/
