By Debbie Franklin, Director of Tax and property tax specialist
Chancellor Jeremy Hunt delivered his 'Budget for Long Term Growth' on Wednesday 6 March 2024. His speech promised 'more investment, more jobs, better public services and lower taxes'.
Below are some key property related measures. See www.peplowsproperty.co.uk/news/budget for full details.
Stamp Duty Land Tax changes
A number of changes are made to the Stamp Duty Land Tax (SDLT) regime. These include the following:
- The abolition of Multiple Dwellings Relief, broadly from 1 June 2024 but subject to transitional rules, for purchasers of residential property in England and Northern Ireland.
- Changes to First-Time Buyer Relief to extend it to individuals buying a new residential lease via a nominee or bare trust for transactions with an effective date (usually the date of completion) on or after 6 March 2024, but subject to transitional rules.
- Public bodies in England and Northern Ireland will be removed from the scope of the 15% SDLT higher rate charge where the effective date of transaction (usually the date of completion) is on or after 6 March 2024.
Furnished Holiday Lettings
The Furnished Holiday Lettings (FHL) tax regime will be abolished from April 2025. Draft legislation is to be published and will include anti-forestalling measures that will apply from 6 March 2024. The effect of abolishing the rules will be that short-term furnished holiday lets and longer-term residential lets are treated the same for tax purposes and individuals will no longer need to report the two income streams separately.
Capital Gains Tax rates
The Capital Gains Tax (CGT) rate remains at 10%, to the extent that any income tax basic rate band is available, and 20% thereafter.
Higher rates apply for certain gains, mainly chargeable gains on residential properties, with the exception of any element that qualifies for Private Residence Relief. These rates are changed from 18% and 28% in 2023/24 to 18% and 24% in 2024/25.
There is still potential to qualify for a 10% rate on gains up to £1 million under Business Asset Disposal Relief and £10 million under Investors' Relief.
CGT annual exemption
The government has announced that the CGT annual exempt amount will be reduced from £6,000 to £3,000 from 6 April 2024.