Stamp Duty on Investment Property by Heather Hilder on September 20, 2018 Stamp Duty Land Tax (SDLT) on Investment Property If you’re buying a second home, Buy-to-Let, or investment property, you should be aware that there is an additional 3% Stamp Duty Land Tax (SDLT) on top of the standard SDLT amount payable. Since this regime was introduced in 2016, the market for second homes has certainly felt the pinch, especially for buy-to-let landlords who are also being penalized with a reduction in the amount of mortgage interest that can be claimed against tax. Certainly if you are in a fortunate enough position to be able to buy an investment property or second home, then yes, an average £250,000 purchase will cost you an extra £7,500. This additional expense might ultimately have to be absorbed by the vendor, who may have to accept a lower offer than expected, as the investment buyer will have less in their pocket. A further frustration for investors is that the extra money may have to be found in cash if the additional amount pushes the buyer over their Loan-to-Value ratio as purchase costs such as SDLT may not be included in any mortgage borrowing. Nevertheless, property remains one of the most reliable investments available and we are continuing to see strong yields for the savvy investor in this area. The old adage of “not letting the tax tail wag the investment dog” is probably worth considering! Rest assured that our local knowledge and property expertise will guide you both through the process towards a successful outcome, irrespective of SDLT as our role as investment managers is to help you maximize your return on that investment. Please feel free to contact our Callaways Team today for straight-talking advice on 01273-735237.