💷 Thinking of Selling Your Buy-to-Let in 2025? What You Need to Know About the Financial & Tax
Selling a rental property can be both exciting and daunting — especially when there are financial implications to weigh up. Whether you're streamlining your portfolio, cashing in on capital growth, or just ready to move on, it's important to think through the tax and money side of things before putting up the “For Sale” sign.
At Greater London Properties, we work with landlords across London — from first-time investors to seasoned pros — and we know the right advice can make all the difference. That’s why we’re always happy to recommend trusted financial and tax advisors to help take the stress off your plate.
Below are the key questions (and answers) every landlord should consider when selling a buy-to-let property in 2025:
💡 What will my Capital Gains Tax (CGT) liability be?
When you sell a buy-to-let property that’s increased in value, you may be liable for Capital Gains Tax (CGT) on the profit. For 2025, CGT rates for residential property typically remain at:
18% for basic rate taxpayers
24% for higher/additional rate taxpayers
You’ll also have a CGT allowance (currently £3,000 per person) to reduce your taxable gain — though this has been significantly reduced from previous years, so it may not go as far as it once did.
🧾 Have I factored in current CGT rates and any available reliefs?
If you’ve ever lived in the property as your main home, even briefly, you may be eligible for Private Residence Relief and Lettings Relief. These can reduce your CGT bill, but the rules are strict and often misunderstood — definitely one to run past an accountant.
🛠 Can I deduct allowable expenses (like estate agent fees, legal costs, and improvements)?
Yes, you can deduct certain costs from your gain before working out your CGT liability, including:
- Solicitor and estate agent fees
- Stamp Duty Land Tax (paid at purchase)
- Capital improvements (e.g., a new kitchen or extension – not general repairs)
- Costs of surveys and valuations
These deductions can make a big difference, so it’s worth digging out all relevant receipts and documents. If you’re not sure what qualifies, we can connect you with an expert to guide you.
💼 How will the sale affect my overall income for the tax year?
CGT on residential property is tied to your income tax bracket, meaning the profit from your sale is added to your other income that year.
This might:
- Push you into a higher income tax bracket
- Affect your child benefit, student loan repayments, or personal allowance
Some landlords consider staggering the sale (if they own multiple properties) or timing it across tax years to spread out the impact. Again, it’s all about timing — and we can help you think through the options with the help of our recommended financial advisors.
🗓 Should I defer or bring forward the sale for tax efficiency?
If your income will be significantly higher or lower this year than next, it might make sense to delay or speed up the sale. For example:
- Retiring next year? You might pay less CGT then.
- Expecting a bonus this year? You could tip into a higher rate unnecessarily.
- Tax planning might not be glamorous, but it can be profitable. It’s all about knowing your numbers — and getting the right advice at the right time.
📈 Is now the right time to sell from a market perspective?
The London property market in 2025 is still adjusting to post-pandemic shifts, interest rate changes, and evolving landlord legislation. While prices have remained fairly robust in most zones, especially in areas like Herne Hill, Dulwich, and Soho, it’s always worth asking:
- Am I likely to get top value now?
- What are buyer demand and local competition like?
- Are changes to BTL regulation (e.g., EPC upgrades, mortgage interest rules) pushing more landlords to sell?
Our local agents at Greater London Properties are in constant contact with buyers and investors, so we’re well-placed to give you a grounded, honest appraisal — not just about the price, but about timing and strategy too.
🏖 What will I do with the proceeds?
This is a personal one — and also a powerful one. Are you:
- Looking to reinvest in a different area?
- Diversifying your assets (e.g., into stocks or a pension)?
- Using the funds to pay off debt, gift to family, or enjoy a well-earned break?
The right answer depends on your broader financial picture. Whether you’re restructuring your portfolio or stepping away from property altogether, we can put you in touch with trusted independent advisors who can help map out your next steps.
🧠 Final Thoughts
Selling a buy-to-let isn’t just a transaction — it’s a strategic decision. And while tax and finances can feel overwhelming, you don’t have to navigate it alone.
At Greater London Properties, we’re more than just estate agents — we’re local experts with a trusted network of tax specialists, financial planners, and legal professionals who can help take the pressure off and ensure you’re making decisions that work for you.
If you’re starting to think about selling your rental property in 2025, we’d love to chat — no pressure, just helpful, honest advice.
Warm Regards
Kate and Rob Hill
Greater London Properties
Founders of GLP and Support Our School Initiative
Specialists in sustainable, personal, and internationally-minded property marketing