2024 Budget Highlights: Key Tax Changes for Property Investors and Landlords
Labour’s October Budget, led by Reeves, has introduced several tax adjustments impacting property investors and landlords:
Stamp Duty Land Tax (SDLT): Effective October 31, 2024, the SDLT surcharge on second homes and investment properties rises from 3% to 5%. Temporary SDLT thresholds will also revert by March 31, 2025, potentially driving demand in rental markets.
Capital Gains Tax (CGT): Rates on property remain at 18% and 28% (for lower- and higher-rate taxpayers, respectively). However, CGT rates on shares and other assets will increase, aiming to raise £2.5 billion for public services.
Inheritance Tax (IHT): The current £350,000 IHT threshold freeze extends to 2030, with inherited pensions subject to IHT starting in 2027.
Income Tax Thresholds: From 2028, Income Tax thresholds will adjust with inflation, easing the impact of fiscal drag.
Business Rates: Labour will reduce temporary relief on business rates from 75% to 40% through 2026, supporting retail and hospitality.
Employer’s National Insurance: From April 2025, a 1.2% rise in employer’s NI and a reduced threshold of £5,000 will apply, with increased Employment Allowance to shield smaller employers.
Social Housing Investment: £500 million will fund 5,000 new social homes, with a larger £5 billion initiative focused on small housebuilders and planning support.
This summary provides general information and is not financial advice. For mortgage guidance, consult a qualified advisor.
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