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HMRC Publishes Guidance On Higher SDLT Rates For Purchases Of Additional Residential Properties

Friday 29th April 2016

HMRC has issued further guidance on the higher SDLT rates applicable to purchases of additional residential properties, including second homes and buy to let properties, which the Chancellor originally announced in his 2015 Autumn Statement.

The Government consulted on details of the policy design between 28 December 2015 and 1 February 2016 and the Chancellor confirmed in his March 2016 Budget that these changes would be introduced from 1 April 2016, for purchases of additional residential properties that complete on or after 1 April 2016.

The higher rates will be 3% above the standard rates of SDLT but will not apply to purchases of property under £40,000 or purchases of caravans, mobile homes and houseboats.

Transitional provisions provide that where contracts were exchanged on or before 25 November 2015 and the purchase completes on or after 1 April 2016, the higher rates will not apply. However, these transitional provisions may not apply to certain transactions which involve the variation of a contract, assignments of rights or sub-sales, or which arise from the exercise of certain rights or options.

The legislation will be included in Finance Act 2016 and given provisional effect by a resolution made under the Provisional Collection of the Taxes Act 1968.

If you would like more information on the above, please contact Keith Rushen on 0207 486 2378.

 

 

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