Stamp duty hike confirmed by Chancellor

Stamp duty hike confirmed by Chancellor

George Osborne has used part of his budget announcement to confirm what many landlords feared, namely that the 3% Stamp Duty surcharge on additional properties is to go ahead next month.

The chancellor outlined that receipts would go toward helping people get on the housing ladder in the south west of England.

He also also announced reforms to Stamp Duty Land Tax on commercial property, which will kick in at midnight tonight, saying: “Just over a year ago, I reformed residential stamp duty. We moved from a distorted ‘slab’ system to a much simpler ‘slice’ system. As a result, 98 per cent of homebuyers are paying the same or less and revenues from the expensive properties have risen. The IMF have welcomed the changes and suggest we do the same for commercial properties. That is what we are going to do, and in a way that helps our small firms.

At the moment our small firms can pay just £1 more for a property and face a tax bill three times as large – that makes no sense.”

From midnight, stamp duty on commercial property will have a zero rate band on purchases up to £150,000; 2% rate on the next £100,000 and a 5% top rate above £250,000.


Mark Tighe, managing director, capital allowances tax specialists, Catax Solutions, said: "The reduced stamp duty payable on commercial property announced by the Chancellor will doubtless drive demand in this key asset class in the months and years ahead.
 
But the resultant increase in transactions, among both businesses and private individuals buying commercial property, will potentially cost billions as a largely unused tax relief is lost forever. Capital allowances are a highly valuable tax relief available to owners of commercial property but under current legislation they are irrecoverable if they are not identified and realised at the point of sale.
 
Currently, very few commercial property owners, along with their accountants and lawyers, are aware of unused capital allowances tax reliefs. Therefore as transaction levels increase in volume and momentum, commercial property owners are set to lose significant tax rebates to the tune of thousands, tens of thousands or even hundreds of thousands of pounds."

Join our mailing list:

Leave a comment



Our Next Event

Commercial Finance Roadshow May 2017

Commercial Finance Roadshow May 2017

Exeter - 23/05/2017

Southampton - 24/05/2017

Rainham - 25/05/2017

Milton Keynes - 26/05/2017

Register now

Latest Comments

Tony Gimple
Tony Gimple 14 Apr 2017

I'm not at all surprised that so many landlords are still confused about what the tax changes really mean and how it will affect them. In particular, the blind rush to incorporation is leaving landlords...

view article
MH
MH 13 Apr 2017

You are right that the bank holidays are going to be spoiled in looking for the properties. But people who want to sell their property and looking for the better relocation, they can get benefits of this...

view article
bnellyb
bnellyb 08 Apr 2017

There will be an exodus of private landlords over the next 5 years as tax changes take effect, private landlords provide an important service to the rental market, why do housing associations and councils...

view article
Fred Cassman
Fred Cassman 07 Apr 2017

"Make it look like you are at home": often people forget this and share on facebook their location!

view article
jared townsend
jared townsend 05 Apr 2017

It'll be interesting to see how & if the Government's asset sale regarding mortgages helps

view article
SecomTech
SecomTech 04 Apr 2017

...and not one mention of the rules on PERMITTED DEVELOPMENT!!! Unless you have studied the plans you will not know...It's probable a high proportion would not need planning permission...BUILDING Control...

view article
Jonathan
Jonathan 03 Apr 2017

That's a very interesting study indeed. There is no doubt that new services and web apps such as Wonego.com in the UK or Roomster in the US will change the way people look for a flatmate, and that tenants...

view article
MBM Homelets
MBM Homelets 23 Mar 2017

Although this is a very positive step, there is little or no guarantee of the standard of workmanship employed by the tenants. We have had experience of a professionally decorated property being ' painted'...

view article
ajay
ajay 21 Mar 2017

How is the "robust evidence" looking now?

view article
NathanG
NathanG 20 Mar 2017

I've been watching the series so far and am completely baffled by the cases that were presented. Though, I don't think that we can protect ourselves from every scam possible - it will just make the scammers...

view article
Landlady14
Landlady14 01 Mar 2017

You would think so Niraj Shah! My experience only proves that there are varying qualitiers of professional in all aspects of property letting. None of the ones I have dealt with, from letting agents to...

view article
Mark
Mark 01 Mar 2017

Thanks for this article. Hopefully one day everybody's lifestyle will be eco-sustainable.

view article

Related stories

More articles from Hero