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What do budget changes mean for buy-to-let investment?
Mar 02, 2016
The recent budget announcement from finance minister John Swinney brought more changes that directly impact the buy to let investor. Mr Swinney announced a LBTT ‘second-homes’ supplement on purchases of additional residential properties, including buy-to-let properties. The proposed Land and Building Transaction Tax (LBTT) supplement is 3% of the total price of the property for all relevant transactions above £40,000.
What will you pay?
Not only will a buyer of a second property have to pay LBTT charges, but also an additional 3% levy. For example if you were looking to purchase a property at £150,000 – under the current rates you would pay LBTT of £100 but from April, this figure would increase to £4600 (£100 LBTT plus £4500 second homes supplement). This additional cost may influence where you choose to buy and how you choose to present the property.