Anybody that buys a second residential property (including landlords) will pay an extra 3% points in stamp duty.
For example, assume buy a residential let property for £200,000.
Up to 1st April 2016, the stamp duty will be:
|On the first £125,000||Nil|
|On the next £75,000, 2% charge||1,500.00|
From 1st April 2016, the stamp duty will be:
|On the first £125,000, 3%||3,750.00|
|On the next £75,000, 5% charge||3,750.00|
A staggering increase, £6,000.
The new rates will apply to purchases with a completion date after 1st April 2016.
However, if contracts were exchanged before the announcement of the new rules on 25th November 2015, then the higher rates will not apply to that particular transaction should the completion date fall after 1st April 2016.