To save you trawling through the budget papers here are the changes that will affect you and I as...
To save you trawling through the budget papers here are the changes that will affect you and I as landlords over the coming year.
It will be interesting to see the inevitable creativity surrounding the probate percentage breaks and capital gains tax amendments.
The previously announced 3% Stamp Duty surcharge on the purchases of second properties will go ahead on April 1, with three main changes from the original proposals.
The first change; No exemptions for larger investors – previously, it had been proposed that those buying 15 properties in one deal would be exempt.
The second change; People who buy a second property as their home before selling their first, will have a longer window in which to dispose of their first home.
A timeframe of 18 months has been replaced by 36 months. The Treasury said that this would now be the time at which a refund could be claimed.
The third; amendment is that husbands and wives living apart, and intending to remain living apart, will no longer be treated as a single unit. This means that separating couples will not be faced with an extra Stamp Duty bill should one of them buy another home.
The Treasury has also clarified the position of probate properties, typically left to children in the family.
It said that where someone owned less than half of an inherited property, this would not be considered as an additional property subject to the surcharge.
Yesterday’s Budget emphasised that Capital Gains Tax is being reduced from April 6 – down from 28% to 20% in the higher band, and from 18% to 10% in the basic rate.
Although, there will be an 8% surcharge applied to the sale of any residential properties being sold by landlords – meaning that what they pay will stay the same as now.
Economic:- Growth forecast cut to 2% for 2016 from the 2.4% forecasted last year
Inflation is to remain low at 0.7% for 2016
Information sourced from The Property Industry Eye
Image by Kipper Williams