Buy-to-let homes face higher stamp duty
So what is the real cost?
The new SDT will be dependent on the cost of the purchase and is will be payable if the property is purchased as a ‘Buy To Let’ investment or Second home. For property up to £125,000 this will raise from 0% to 3%.
- up to £125,000 from 0% to 3%
- £125 – £250,000 from 2% to 5%
- £250 – £925,000 from 5% to 8%
- £925 – £1.5m from 10% to 13%
- over £1.5m from 12% to 15%
|Up to £125,000||0%||3%|
|£125 – £250,000||2%||5%|
|£250 – £925,000||5%||8%|
|£925 – £1.5m||10%||13%|
Buy-to-let landlords will also be hit by a change to Capital Gains Tax (CGT) rules.
From April 2019, they will have to pay any CGT due within 30 days of selling a property, rather than waiting till the end of the tax year, as at present. Landlords are already due to get a lower rate of tax relief on mortgage payments. In his summer Budget, the chancellor said that landlords would only receive the basic rate of tax relief – 20% – on mortgage payments, a change being phased in from 2017. Responding to the latest changes, Richard Lambert, chief executive of the National Landlords Association said: “The chancellor’s political intention is crystal clear; he wants to choke off future investment in private properties to rent. “If it’s the chancellor’s intention to completely eradicate buy-to-let in the UK then it’s a mystery to us why he doesn’t just come out and say so”. Up to £60m of the money raised from the stamp duty surcharge will go to help home-buyers in England in places where holiday homes have forced up local prices.
Help to Buy
The Help to Buy (equity loan) scheme in England will also be extended to 2021, one year longer than planned. An extension to the scheme in London will see buyers who can find a 5% deposit given a loan worth up to 40% of the property. The loan will be interest free for five years. Elsewhere the existing maximum loan is for 20% of the property’s value. In total, the government will put an extra £6.9bn into housing. This includes an extra £2.3bn in loans for the government’s starter homes programme, and £4bn lent to housing associations and local authorities to build more homes for shared ownership. Another £200m will be used to build homes for rent, which will allow tenants to save for a deposit. There will also be a pilot scheme to trial the government’s Right to Buy programme for housing association tenants. Five housing associations will take part, to help design the final scheme.
Jason ensured the transaction completed as agreed