Chancellor unveils 3% stamp duty surcharge for buy-to-let homes
25th November 2015 | News
Chancellor, George Osborne has confirmed that from April 2016, buy-to-let landlords and those buying second homes will be required to pay an additional three per cent surcharge on the stamp duty charged for the property.
The move, announced in today’s 2015 Autumn Statement, is set to raise an extra £1bn for the Treasury coffers by 2021.
In his Summer Budget, Mr Osborne made it clear he wanted to “start levelling the playing field” between those renting and owning by ensuring landlords would only receive the basic rate of tax relief on mortgage payments.
The Chancellor has gone one step further this time around, provoking an angry reaction from landlords who believe it will “choke off” investment in rented properties.
It has also been proposed that landlords liable for Capital Gains Tax on the sale of a residential property - that’s not their primary home - must pay the tax owed within just 30 days as of 2019.
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 this new surcharge will be put towards helping homebuyers across England in places where holiday homes in particular have forced up local prices.
In addition, the Help to Buy scheme in England is also to be extended to 2021, one year longer than planned.
The Chancellor has also unveiled a London-specific Help to Buy scheme, with buyers who can put together a five per cent deposit given a loan worth up to 40 per cent of the property, interest free for five years.
There will also be a pilot scheme to trial the Government’s Right to Buy programme for housing association tenants with five housing associations chosen to take part and help design the final scheme.