18th September 2017
Changes to stamp duty legislation saw a 3% surcharge levied on newly-bought second homes and subsequent properties, according to research from Direct Line for Business.
Any landlord paying the UK average house price of £219,544 for an additional property in December 2016 faced a stamp duty bill of £8,477 - £6,586 more than they would previously have had to pay (£1,891).
Landlords in London have been worst affected, with stamp duty standing at £28,704 on buy-to-let properties worth an average of £483,803.
In addition, fines of £30,000 will be handed out if landlords fail to licence an address under the recently introduced Houses in Multiple Occupation and Residential Property licensing reforms.
Further fines of up to £3,000 are in place if landlords do not conduct the necessary checks or lack the right documentation for their tenants.
Christina Dimitrov, business manager at Direct Line for Business, said:
“Being a landlord in the current climate can be a profitable business, especially if there is a demand for rental properties as we’ve seen in recent years.
“However, with so many changes taking place, and with more on the horizon, it’s essential for any landlord to be fully up-to-speed with legislation as the penalties for breaking the law can erode any potential profits.”
Contact us to discuss your tax obligations.