Buy to let landlords can at least drown their sorrows with a penny off their pints as Chancellor George Osborne failed to introduce any property tax changes in his Budget 2013.
Announcing a tax neutral budget where any tax cuts or reliefs are paid for from spending cuts on raising other funds, the chancellor did not tinker with stamp duty or capital gains tax.
“This is a Budget that doesn’t duck our nation’s problems,” he said to MPs. “It confronts them head on. It’s a budget for an aspiration nation.”
Landlords do make some small gains:
- Property investors trading as limited companies will see corporation tax align with the basic rate of income tax from April 1, 2015 at 20% – which is probably a signal the basic rate of income tax will not rise before the next general election. At the same time, the small company corporation tax rate will go – consigning the calculations for marginal relief to the bin for the first time since 1973.
- The personal tax-free income tax allowance will increase to £10,000 from April 6, 2014
Osborne did announce a fillip for home buyers and house builders with a £3.5 billion Help To Buy scheme underwritten by the government.
“Large deposits demanded by lenders are beyond the reach of most ordinary buyers,” he said.
The scheme works in two ways –
- As a shared equity purchase where home buyers put down a 5% deposit and get a 20% loan from the government that is interest free for five years
- A mortgage guarantee for potential home buyers who can afford to pay a mortgage but cannot raise a deposit
Both schemes run for three years and are aimed at freeing up the housing market and stimulating construction jobs for building new homes.
Other help for housing includes extra cash for large build-to-rent schemes and funds to build 15,000 extra homes.
