Stamp Duty Implications for Buy-To-Let & Landlords

We at Manak Solicitors have a specialised legal team working with a number of Landlords across the South East.

With the introduction of the new stamp duty rates which came into force on 8^th July 2020; now may be the perfect time to look at your portfolio in order to carry out tax efficient planning for the future.

From April 2020, Landlords with portfolios in their personal names rather than a limited company will only be able to claim a tax credit of 20% of mortgage interest payments. Contrasting this to tax year 2017-18 this figure was 75% mortgage relief.

Therefore, it is evident from April 2020 many Landlords have been adversely effected financially.

It can be more advantageous from a tax efficient standpoint for Landlords to hold their portfolio in a dedicated limited company although, many landlords have been hesitant to transfer their properties to a limited company due to the Stamp Duty implications. In view of the new rules; any properties valued under £500,000.00 will only be liable for 3% stamp duty rather than the higher rates before July 2020 providing a much welcome relief to Landlords at such turbulent times.

We recommend Landlords speak to their financial advisors before taking any decisions to transfer their portfolio but on the face of the new rules this does seem like a glimmer of hope. We invite you to contact our qualified team with regards to any property law questions you might have.