Should you come to sell your buy to let property, you may be liable to pay Capital Gains Tax (CGT.) However, you are not charged CGT on the £8,500 of annual profit. Furthermore, if you are married and the property is in joint names, you may use both of your CGT allowances when selling. You can costs incurred in buying and selling from your overall profit.
As the owner of a buy to let property, you may also be eligible for something called CGT taper relief. If you sell the property within three years, you will incur CGT on 100 per cent of all profits (less buying and selling costs.) However, should you keep the property for over three years, the amount that you pay begins to be reduced by 5 per cent per annum. This comes down to 60 per cent after ten years or more.