Landlords contribute most to extra revenue from additional homes stamp duty surcharge. RPC Property Management can show you ways to add to your portfolio by buying in the North West where you can achieve excellent rental returns and still have scope for capital gains from properties priced just below the Stamp Duty threshold.
The latest statistics released by HMRC to the end of July 2017 show that the number of property transactions at 1,204,730 bringing in £12.4 billion in stamp duty is now broadly the same as the year to the end of July 2015 when it was 1,205,700 with £10.4 billion, but stamp duty receipts have increased by 20% in the same period, equivalent to an extra £2 billion in tax.
Analysis from accountants Blick Rothernberg reveals that, while some of the increase could be due to higher property price most of it is due to the 3% surcharge added to additional homes, in particular properties being bought by landlords.
The chart below shows that Stamp duty for 2nd home ownership starts at £40,000. Believe it or not, there are properties very suitable for buy-to-let investors available in our area for under the £40K threshold, and Landlords willing to buy and then refurbish can maximixe their investments by doing just that. Even properties ready to let can sell for under £40,000, especially when fixtures and fittings are not included in the property sale price, but paid as a separate part of the purchase. So if a seller wants £45000 for the property including carpets, curtains, kitchen appliances, fitted wardrobes and an electric shower the stamp duty can be avoided if the basic house sells for £39900 and the fixtures and fittings for £5100.
Table of Rates for Buy-to-let Properties
Properties over the £40,000 threshold pay the full 3% on the entire band from £0. If you want to calculate the stamp duty due for any property try this link to the HMRC calculator http://www.stampdutyrates.co.uk/buy-to-let-rates.html
Rate
Property Price Up to £40,000 -------------- 0%
Over £40,000 and under £125,000----------3%
Over £125,000 and under £250,000---------5%
Over £250,000 and under £925,000---------8%
Over £925,000 and under £1,500,000------13%
Over £1,500,000------------------------------15%
Source: HMRC
For more information, and a conversation about letting property in Burnley, Accrington, Nelson, Padiham, Bolton, Wigan and the general areas os East Lancashire please ring RPC Lettings on 01282 5-459459 or email us on info@rpclettings.co.uk. We have landlords on our books from the local area, throughout the UK and living abroad.
