Thinking of selling? Act quickly before taxes go up

It is widely expected that the rate of UK capital gains tax is set to rise when the new coalition government announces its emergency budget. It is thought that any tax rises will come into force from April 2011, although that may be optimistic. Capital gains tax is currently at 18%, and it is expected that it will rise to mirror income tax rates which are 20% for lower rate tax payers and 40% for higher rate tax payers, with a possible 50% band for those earning over £150,000 per annum.

Please remember that gains on French property must usually be declared in the UK as well as in France. Capital gains tax paid in France can generally be offset against UK capital gains tax to avoid paying the same tax twice. It is worth pointing out that even where a French property is exempt from French capital gains tax, it is likely to be subject to UK capital gains tax for UK tax residents.

If you are considering selling your French property, it may be prudent to consider starting the ball rolling sooner rather than later before any tax rises, and ensure that you seek advice regarding mitigating the capital gains tax. Remember: do not sign an estate agent's agreement or sale contracts without getting them checked.

The Times has given five top tips to reduce your UK capital gains tax, click here.