Proposed changes to Stamp Duty Land Tax from April 2016

Following on from the government’s Autumn Review on spending made this week (on 25th November) changes have been announced with regards to the payment of Stamp Duty Land Tax (SDLT) from 1st April 2016.

Higher rates of SDLT will be charged on purchases of additional residential properties (above £40,000), such as buy to let properties and second homes.

The higher rates will be 3 percentage points above the current SDLT rates. The higher rates will not apply to purchases of caravans, mobile homes or houseboats, or to corporates or funds making significant investments in residential property.

Unfortunately, further details are currently scarce and the Government will consult on the policy detail, including on whether an exemption for corporates and funds owning more than 15 residential properties is appropriate. We also await an announcement on whether the increased levels of SDLT apply on matters that have exchanged before 1st April but that complete after that date. We will give you further updates on the changes and the effects as and when they emerge.

However, what we do know is that the government plans to use some of the additional tax collected to provide £60 million for communities in England where the impact of second homes is particularly acute.

For further information on the Stamp Duty Land Tax and residential conveyancing, please contact:

 

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This article has been prepared for general interest and information purposes only; it does not constitute legal advice and should not be relied on as such. While all possible care has been taken in the preparation of this article, no responsibility for the accuracy and/or correctness of the information and commentary set out in the article, or for any consequences of relying on it, is assumed or accepted by the firm or the authors.