Stamp Duty
Stamp duty is the tax that homeowners pay when purchasing property and land valued over a certain threshold. Under the previous rules, no stamp duty was paid on anything worth up to £250,000 and first-time buyers were exempt up to £425,000. Landlords and investors pay a 3% stamp duty surcharge when purchasing property.
However, the government will increase the stamp duty land surcharge for second homes by 2% to 5%, to come into effect on 31 October, the day after the announcement.
Capital Gains Tax
Investors currently pay CGT on profits they make from selling a property. It is charged at 18% for basic rate taxpayers and 24% for higher and additional rate taxpayers.
Although the headline rates of CGT will be changing, the rates for residential properties will remain the same. This means that the new CGT rates will not impact second properties and buy-to-let properties.
Inheritance Tax
Under the current rules, inheritance tax applies to properties worth more than £325,000, and the rate is 40%. This rises to half a million if the inherited estate includes a residence passed to direct descendants and £1 million when a tax-free allowance is passed to a surviving spouse or civil partner.
This threshold will be frozen until 2030.
House Building
The government pledged to invest over £5 billion to deliver its housing plan. This budget will increase the Affordable Homes Programme to £3.1 billion, provide £3 billion worth of support, and guarantee an increase in the supply of homes and support small housebuilders.
They promise to invest in renovating sites across the country to deliver 2000 new homes, including at Liverpool Central Docks.
