The budget’s repercussions for landlords

Wednesday, 21 March 2012 3:45 PM

The budget announcement today seemed to focus on economic growth and squeezing the high-end markets for money.

But landlords will also be affected by the changes, especially those with large corporate portfolios.

The Get Britain Building fund is to be expanded leaving more opportunity for landlords to grow their portfolios with new builds.

A new stamp duty of seven per cent will be charged on properties priced at more than £2 million which could have an effect on high-end landlords.

But this also means high-end residents might be more inclined to choose rental accommodation for their second and third homes rather than buying further properties and having to fork out the extra stamp duty.

One of the changes which will most impact high-end investors is an additional tax of 15 per cent on properties over £2 million that are held in corporate envelopes.

This means investors who choose to buy high-end properties over this threshold will pay out a whopping 22 per cent of the purchase price in tax.

In terms of personal tax the system is to be simplified which means lodging returns should be easier.

But any return claiming more than £50, 000 in income tax reliefs will be capped.

It is good news for business tax with the headline rate of corporation tax falling to 22 per cent from 2014.

Forecasts are also positive with the country expected to escape recession.

Landlords will see some relief with inflation looking to fall to 1.9 per cent in 2013.

Why take professional advice when buying commercial property?

Purchasing a property, or properties, to let out to tenants can certainly provide a substantial income, but it's important to consider the commitment of buying such a development before handing over any money or signing a contract. In the same way as you would when buying your own home, it's a good idea to seek out professional advice.

What should businesses look for when buying offices?

Purchasing offices presents a great opportunity for a business to expand and increase its ability to generate revenue. However, whether an organisation plans to occupy the development they want to buy, or invest in buildings to let out to other companies, it is not a process that should be done hastily. Indeed, there are many factors that need taking into account.