Higher rates of stamp duty – are you affected?
Higher rates of stamp duty – are you affected?
At first glance, it seemed that the higher rates would only affect buy to let investors. However, this may not actually be the case.
The higher rates of Stamp Duty Land Tax for purchases of additional residential properties came into force on the 1 st April 2016. At first glance it seemed that only buy to let investors would be affected. However, it seems that the position may not be as clear as people may have initially thought.
Which properties do the higher rates apply to?
The higher rates are applicable to anybody who, at the end of a residential property transaction will own two or more properties. The only exception to this is if you are purchasing the new property to replace your main residence which is being sold.
If you have not yet sold your main residence, then the higher rates will apply, but if you sell it within 18 months, a refund will be available.
What about married couples?
Not only buy to let investors are affected by the higher rates, as they apply to anybody who will own or have an interest in more than one property.
Married couples are treated as one unit for the purpose of Stamp Duty Land Tax. Therefore, if you are purchasing a property with a spouse and your spouse already owns another property the higher rates are likely to apply.
Helping children onto the property ladder?
Many parents are helping children get onto the property ladder by purchasing a property with them. However, if you already own a property as your main residence, the higher rates may also apply.
So it seems the situation is not as straightforward as first appeared. If you require any assistance or are concerned about how the high rates of Stamp DutyLand Tax may affect you then please get in touch.
Mandip Kaur Sumal