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Sally Botham Estates
27 Bank Road
Matlock
DE4 3NF
01629 760899
enquiries@sallybotham.co.uk
London
Tel: 020 7318 7087
Stamp Duty Increase for Landlords and Multiple Homeowners
In the Autumn Statement, Chancellor George Osborne announced a substantial increase in Stamp Duty on the purchase of additional residential properties. That will therefore apply to situations such as purchase of a property to let out or of a second home.
From April 2016 any such properties will face an additional 3% charge, on top of the existing levy.
This means the new stamp duty structure in England and Wales
will look like this:
Property Value |
Standard Rate |
Additional
Properties |
£0-£125,000 |
0% |
3% |
£125,001-£250,000 |
2% |
5% |
£250,001-£925,000 |
5% |
8% |
£925,001-£1.5m |
10% |
13% |
Above £1.5m |
12% |
15% |
Stamp duty is applied only to the portion of the property value falling in that band, similar to income tax.
So while a sole home valued at £300,000 would incur
£5,000 stamp duty, if that same £300,000 were an additional Buy to Let property
for example, the stamp duty charge would increase to £14,000 from April.
Property Value |
Standard Rate |
Additional Properties |
||||
|
Rate |
Applied to |
Cost |
Rate |
Applies to |
Cost |
£0-£125,000 |
0% |
£0 |
£0 |
3% |
£125,000 |
£3,750 |
£125,001-£250,000 |
2% |
£125,000 |
£2,500 |
5% |
£125,000 |
£6,250 |
£250,001-£925,000 |
5% |
£50,000 |
£2,500 |
8% |
£50,000 |
£4,000 |
Total charge |
£5,000 |
|
£14,000 |
Clearly that’s a massive increase in costs so we can expect a flurry of activity as potential “additional property buyers” seek to beat the April deadline. Anyone thinking about becoming a new landlord or adding to an existing portfolio is bound to be keen to complete the purchase before the new higher charges come into effect.
That could therefore intensify competition for suitable
property in the next few months. From
April, however, aspiring first time buyers may find life a little easier as
investor numbers ease back.
Guild Mortgage Service, Provided by London
& Country Mortgages
YOUR HOME
OR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR
MORTGAGE
Most buy-to-let mortgages are not regulated by the FCA
Sally Botham Estates
27 Bank Road
Matlock
DE4 3NF
01629 760899
enquiries@sallybotham.co.uk
Tel: 020 7318 7087
As market leaders for over 22 years, we are proud to be one of Derbyshire's most trusted estate agents. With our expert advice, honest and ethical communication, and a professional yet personal service, we are ready and excited to help you with all your property needs.
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