Ministers should hold off tinkering with stamp duty rules for landlords and property investors after a slew of changes in recent years, says tax experts.
The changes impact home buyers and buy to let investors, who along with their advisors, are hard-pushed to keep up with the ever-changing law.
The latest tax is a 1% stamp duty surcharge for non-UK residents buying homes in England and Northern Ireland, which has no start date.
The new rules are confusing for expat couples, with one partner living and working abroad temporarily while the other remains in the UK – but not in Scotland or Wales, who have their own stamp duty rules that vary from those in England and Northern Ireland.
Although the partner in the England or Northern Ireland is not subject to the tax, the expat is – but can claim a refund of the extra stamp duty paid under certain circumstances, like returning to live in England or Northern Ireland shortly after buying a property.
Brian Slater, who chairs CIOT’s property taxes sub-committee, said: “We are concerned at the increasing complexity of tax rules that touch on residential property. Stamp Duty Land Tax (SDLT) has been the subject of technical change in virtually every year since its introduction in 2003.
“The complexity of SDLT will be compounded by the planned 1% surcharge. We urge the government to refrain from making further changes before the impact of recent changes to the taxation of residential property are assessed and the evidence base for the surcharge is evaluated fully.
“This policy measure is aimed at house price inflation that, in turn, needs to be considered in the context of other recent taxation changes affecting non-UK resident buyers such as the introduction in 2015 of non-resident capital gains tax and the extension of inheritance tax in 2017 to non-UK companies owning residential property. The full impact of these measures is yet to be seen.”
