Mike Shakespeare, Financial Planning Associate - Chester branch
For those of us who feel a property portfolio is a valuable part of our financial planning the coming year will include some added costs.
People buying additional property, including buy-to-let or second homes, will face a 3 percentage point surcharge on stamp duty rates from April 2016.
The changes mean someone purchasing a £275,000 buy-to-let home would see their stamp duty bill rise from £3,750 to £12,000 – nearly three times as much.
What stamp duty rate will I pay?
DUTY RATE (1)
NEW STAMP DUTY RATE FOR ADDITIONAL PROPERTIES (1)
Up to £125,000
£125,000.01 - £250,000
£250,000.01 - £925,000
£925,000.01 - £1,500,000
(1) Rate applies to that portion of the purchase price (2) Properties up to £40,000 are exempt from stamp duty. Properties between £40,000.01 & £125,000 will be charged stamp duty on the full purchase price.
If you have an intention to invest more this year it may be worthwhile moving quickly as you need to complete by the end of March.
Alexander Beard can advise on the right Buy To Let Mortgage for you with these mortgages being close to historic lows in terms of rates.