The key matters to draw to the attention of property investors arising from the March 2012 Budget are as follows:-
- A new SDLT rate of 7% to apply to the purchase of residential property over £2m.
- A new rate of 15% to apply to the purchase of residential property over £2m purchase by corporates.
- Consultation on an annual levy on residential property over £2m held by corporates.
- Proposal to make a CGT charge on the disposal of UK property by non resident corporates.
- No SDLT change on the transfer of shares of a company.
I would anticipate that in due course the increase in SDLT at £2m will be priced into the market. In the short term there is likely to be a dampening of demand.
Offshore investment into the UK at the high end may be dampened while the Government's proposals are worked through.
The focus of investment at the high end is now likely to be focused upon individual purchases at below £2m.
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