Chancellor George Osborne has announced a stamp duty increase of 3% on buy-to-let properties from April 2016.
The measure will apply to purchases of additional residential properties above £40,000, such as buy-to-let properties and second homes (in England and Wales). Luckily, this doesn’t apply to Scotland quite yet.
Buy-to-let landlords will also be hit by a change to Capital Gains Tax (CGT) rules.
From April 2019, they will have to pay any CGT due within 30 days of selling a property, rather than waiting till the end of the tax year, as at present.
Landlords are already due to get a lower rate of tax relief on mortgage payments.
In his summer Budget, the chancellor said that landlords would only receive the basic rate of tax relief – 20% – on mortgage payments, a change being phased in from 2017.
So, the 3% surcharge may actually drive investors north of the border until negative changes are implemented in Scotland.