It looks increasingly likely that the government will confirm a 3% stamp duty surcharge on the purchase of homes by non-UK residents.
Whilst full details of any increase will be unveiled in the budget later this week, it is likely that the 3% surcharge will apply on top of the 3% additional home surcharge. This could lead to overseas investors paying a top rate of 18% on the part of the purchase price that exceeds £1.5m.
The Conservative Party manifesto noted that 13% of new build homes in London were purchased by non-UK residents between 2014 and 2016 and that such properties were often purchased by wealthy individuals and rented out at inflated prices. It was noted that this adds significant amounts of demand to limited supply, inflating house prices and making it harder for people in Britain looking to get a foot on the property ladder.
It is estimated that such measures will affect approximately 70,000 purchases per year and raise up to £120 million per annum.
We will publish a summary of any stamp duty changes following the budget.
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