The government announced in its 2018 budget that it would consult on the design of a stamp duty land tax (SDLT) surcharge on non-UK residents purchasing property in England and Northern Ireland.
The non-resident surcharge is expected to apply to purchases of residential property made by non-UK resident individuals and certain non-natural persons.
The surcharge applies to freehold and leasehold purchases of residential property at a rate of 1% on top of existing SDLT rates.
The government’s stated policy objective for the proposal is to assist UK residents getting on to the housing ladder.
We met with HM Revenue and Customs (HMRC) and HM Treasury to discuss the proposals in April 2019 and submitted a response to the consultation in May 2019.
Our response expresses concern about the insufficiency of the evidence base to show that the surcharge would meet the policy objective.
We suggest amendments to seek to avoid potential unfairness and anomalies that would arise from the current proposals.
We also voice serious concerns about the introduction of significant further complexity into the home buying process.
What this means for solicitors
Solicitors who advise on real estate, particularly SDLT aspects of residential conveyancing transactions, would be affected by these proposals.
The consultation closed on 6 May.
The government has stated that it will introduce the proposed surcharge in a future Finance Bill.
They are currently analysing the feedback from the consultation.
Read the consultation on the GOV.UK website