A very happy and prosperous new year to our readers from MORRIS COOK CHARTERED ACCOUNTANTS. It includes: the draconian increase in Stamp Duty for buyers of second homes or buy-to-let property; a summary of other changes announced for next year and beyond; and a note of changes to car fuel advisory rate changes 1 December 2015.
Car fuel advisory rates changes
From 1 December 2015, the advisory fuel rates have changed to:
1400cc or less: petrol 11p per mile, LPG 7p per mile
1401-2000cc: petrol 13p per mile, LPG 9p per mile
Over 2000cc: petrol 20p per mile, LPG 13p per mile
1600cc or less: 9p per mile
1601-2000cc: 11p per mile
Over 2000cc: 13p per mile
These rates can be used from 1 December 2015 to calculate the petrol content of mileage rates paid to employees, or as a basis to repay private petrol provided by employers for the use of a company car.
Stamp Duty increase for second home buyers
George Osborne and his team seem to have a grudge against landlords and second home owners. From 1 April 2016, Stamp Duty Land Tax (SDLT) payable on the acquisition of residential property – where the property is a second home or a buy-to-let investment - will see a significant increase in the amount of SDLT payable.
At present, this will only apply to properties purchased in England and Wales. In Scotland, the new Land and Buildings Transaction Tax applies.
Andy Jones is considering a further acquisition for his Midlands based buy-to-let property business of £300,000. What are the SDLT implications of buying before or after 1 April 2016?
Completion date 1 March 2016 – SDLT payable would be £5,000.
Completion date 1 May 2016 – SDLT payable would be £14,000.
The virtual tripling in SDLT due is a result of the 3% increase in SDLT rates from 1 April 2016. For acquisitions after 1 April 2016 the new rates are:
£0 to £40,000 no SDLT is payable
£40,000 to £125,000 – 3% on total cost of acquisition
£125,001 to £250,000 – 5% on this band only
£250,001 to £925,000 – 8% on this band only
£925,001 to £1.5m – 13% on this band only
Over £1.5m – 15% of the property price above this amount
Will this fuel a rush to buy before rates increase on 1 April 2016? Prospective buyers may want to consider this option, but don’t buy in haste and repent at leisure!
A HOST OF NEW INITIATIVES IN THE OFFING
The government has also published its intention to change a number of other tax reporting issues. Some of the more impactful for smaller businesses and Self Assessment tax payers are reproduced below:
FOR MORE INFO on any of these issues, contact Morris Cook Chartered Accountants.
Member since: 10th July 2012
A quick introduction - I'm John Waine, Director of TheBestOfOswestry. Having lived in this beautiful area for around 20 years now, I have decided to stay. :)
With kind thanks