A new surcharge levied on non-UK resident homebuyers is being considered as part of the government’s attempt to help control rising house prices.
HM Treasury has announced that the proceeds of the new surcharge will be put towards measures used to support rough sleepers, as it has pledged to end rough sleeping by 2027.
The Stamp Duty Land Tax: non-UK resident surcharge consultation will look at how a new 1 per cent increase to stamp duty costs for non-UK residents buying residential property in England and Northern Ireland would work. This follows a commitment made by Prime Minister Theresa May and a subsequent announcement of the proposed rate at Budget 2018.
Commenting on the increase, Treasury and Paymaster General financial secretary Mel Stride said: “The UK is and will remain an open and dynamic economy, but some evidence shows that non-UK resident buyers of UK property could be inflating house prices.
“A 1 per cent surcharge could help more people own their own homes in the future, and its proceeds will go towards tackling rough sleeping, boosting our plan to halve the numbers of rough sleepers by 2022.”
The consultation will cover all aspects of the charge, including how non-residents will be defined and how it applies to companies. Further details on how much the charge is expected to raise will be published after the consultation has concluded.
The charge will apply to any person who is non-resident in the UK, including certain UK-resident companies which are controlled by overseas shareholders.
However, crown employees working abroad, such as military service personnel, will not have to pay the surcharge at all whilst those who buy a residential property and then move to the UK will be eligible for a refund of their extra payment.
To read the full consultation, click here.
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