Understanding property tax - Telegraph With the tax amnesty on the sale of second homes ending last week, the Labour party continuing to promote the mansion tax and the October 31 self-assessment tax deadline looming, property investors who don't understand the current and future tax implications of their property portfolio may find their investment doesn't deliver what they expect. Many landlords don't spend anywhere near enough time, or take enough expert advice about the tax implications of their property wealth. Some don't think rental income is taxable at all; others, as the recent second homes tax amnesty has shown, don't know that sales of second homes are subject to capital gains tax. Many don't appreciate their property wealth is taxed in conjunction with their existing earnings and assets, so in some cases don't realise rental income from investment can put them into a higher tax bracket. What a lot of landlords don't think through either is that tax rules change. If you invested in property 10 years ago, you would have expected to have sold your property today and via taper relief only paid 10 per cent capital gains tax. However, capital gains tax has changed and now: over and above your allowance, you would pay two to three times this amount. A lower rate taxpayer today would pay 18 per cent and a higher rate taxpayer would pay 28 per cent. With the election coming up and housing being such a hot topic, it wouldn't be a big surprise if the political parties come up with new property tax policies which could affect landlords. Make sure you do what you can to mitigate the tax you pay. Typically, tax experts can help reduce your tax bill before changes to the system are made, but it's much trickier to do this afterwards. If you don't know what tax you owe today on rental income and what you would owe if you sold your portfolio, now is a good time to check your position with a specialist property tax expert. Kate Faulkner is managing director of Designs on Property. You may also be interested in: Track down property hotspots >> Has the tide turned for commercial property? >> How to become landlord >> Telegraph Property Club membership: Sign up to receive exclusive tips and advice direct to your inbox >>