Budget 2016: The Key Points
2 minute read
With the dust appearing to settle on the chancellor’s Budget of 2016, Just Mortgage Brokers have taken the opportunity to assess the results of what has been a controversial budget for the UK mortgage and property market. Here are some of the key points from George Osborne’s Budget.
The Introduction of the Lifetime ISA
One of the most popular results of this year’s Budget was the introduction of the Lifetime ISA. From April 2017, the government will introduce a Lifetime ISA with a 25% government bonus, intended to help people aged 18-40 save for their first home and/or retirement.
Stamp Duty Shake Up
Stamp duty on buy-to-let or second properties has been a big talking point in the UK property world for some time, since plans to increase stamp duty on second property purchases were announced in last year’s Autumn Statement. The changes mean that an additional 3% will have to be paid across all bands starting in April 2016. A minor amendment was made meaning sellers will now have 36 months, instead of the proposed 18 months, to claim back any extra stamp duty paid between buying and selling their personal residential homes.
Changes to Capital Gains Tax
Capital Gains Tax is being reduced from 18% to 10% for basic rate taxpayers and from 28% to 20% for higher taxpayers; however, gains from residential property will not be subject to the lower rates. Gains from commercial property will be subject to the new lower rates. In conclusion, it’s been widely accepted that this Budget will benefit the young and higher earners more than other demographics. Residential buy-to-let investors appear to be the group that’s been hit the hardest. Small businesses will no doubt be very pleased with the results of the Budget, with half of all commercial properties in England having their business rates cut. As of 1st April 2017, Small Business Rate Relief (SBRR) will be permanently doubled from 50% to 100%, and thresholds will be increased so more businesses can receive greater relief. For local development and employment prospects this is great news. If you would like to discuss the results of the Budget, in relation to property, please speak to one of our experienced advisers today. You can call us on 0800 114 3753 or use our contact form. Image Source