Wednesday, 25 November 2015

Buy to let - extra stamp duty

George Osborne's new 3 per cent stamp duty charge for buy to let landlords will add £5,520 on the price they pay for the average £184,000 buy to let purchase.

The new charge would have hit 160,000 buyers if it had applied last year, or 13 per cent of the total buy to let market.

Commercial property investors, with more than 15 properties, are expected to be exempted from the new charge.

The Chancellor said people snapping up buy to lets and second homes "should not be squeezing out families who can't afford a home to buy".

The 3 per cent charge will be added to each stamp duty rate, so properties costing up to £125,000 -- which are zero-rated at the moment - will incur 3 per cent.

Those costing from £125,000 to £250,000, currently at 2 per cent, will incur 5 per cent duty and so on for the higher rates.

People who buy two homes by mistake, because they are in a chain which breaks apart, will have to pay the extra duty but will be able to claim it back within 18 months if they manage to sell their original home.

Buy to let enthusiasts will not face the charge until April next year, following a consultation on the details.

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