Stamp duty land tax (SDLT) on additional properties

From 1 April 2016, higher rates of SDLT will be charged on purchases of additional residential properties (above £40,000), such as buy-to-let properties and second homes. The higher rates will be three percentage points above the current SDLT rates.

These higher rates will not apply to purchases of caravans, mobile homes or houseboats, or to corporates or funds making ‘significant investments in residential property’. The Government will consult on the policy detail.

SDLT filing and payment process

There will be a consultation on changes to the SDLT filing and payment process to come into effect in 2017/18, including a reduction in the filing and payment window from 30 days to 14 days.

Annual Tax on Enveloped Dwellings (ATED) and 15% rate of SDLT

The Government will extend, from 1 April 2016, the reliefs available from ATED and the 15% higher rate of SDLT to equity release schemes (home reversion plans), property development activities and properties occupied by employees.

SDLT: application to certain authorised property funds

The Government will introduce a seeding relief for Property Authorised Investment Funds (PAIFs) and Co-ownership Authorised Contractual Schemes (CoACSs) and make changes to the SDLT treatment of CoACSs investing in property so that SDLT does not arise on the transactions in units. There will be a defined seeding period of 18 months, a three-year clawback mechanism and a portfolio test of 100 residential properties and £100m value or 10 non-residential properties and £100m value. These changes will take effect from the date Finance Bill 2016 receives Royal Assent.

Capital Gains Tax (CGT): payment window

From April 2019, a payment on account of any CGT due on the disposal of residential property will be required to be made within 30 days of the completion of the disposal. This will not affect gains on properties which are not liable for CGT due to Private Residence Relief. Draft legislation will be published for consultation in 2016.

CGT for non-UK residents disposing of UK residential property

With effect from 25 November 2015, the Government will amend the CGT computations required by non-residents on the disposal of UK residential property by removing (with retrospective effect from 6 April 2015) a double charge that occurs in some circumstances and correcting an omission. HM Revenue & Customs will be given powers to prescribe circumstances when a CGT return is not required by non-residents and will add CGT to the list of taxes that may be collected on a provisional basis.