Chancellor George Osborne’s Budget 2014 delivered little in the way of good news for landlords or property investors.
The expected big announcement was how the government intends to tax treat capital gains for expat property owners.
However, no news was forthcoming and none of the documents published with the Budget made any mention of the upcoming changes, so property owners and advisers are none the wiser.
New avoidance rules was one issue that covers property – Osborne announced that from midnight on Budget Day, homes purchases worth more than £500,000 by companies will pay stamp duty at 15%, although rented property is exempt from the charge.
Many of these are empty properties held in corporate envelopes to avoid stamp duty,” said the Chancellor.
The only point of interest for landlords was the change in income tax.
The personal allowance will rise to £10,500 from April 2015, saving most taxpayers around £800 a year.
Osborne has obviously listened to tax advisers and think-tanks and pushed up the higher rate tax threshold to remove some middle-earners from the net.
In 2014-15, the threshold will start at £41,865 before earners start paying 40% tax, rising to £42,285 in the 2015-16 tax year.
“The message from this Budget is you have earned it; you have saved it; and this government is on your side. Whether you’re on a low or middle income,” said Osborne.
The big Budget changes are for pension investors and savers.
A new ISA allows a £15,000 tax-free limit each year, while retirees can take charge of their direct contribution pensions by controlling their own drawdowns.
From March 27, the Chancellor has:
• Cut the flexible drawdown minimum income requirement from £20,000 to £12,000
• Increased the capped drawdown limit from 120% to 150%
• Increased the size of the lump sum small pot five-fold to £10,000
• Almost doubled the total pension savings taken as a lump sum to £30,000