Yet again this was not a Budget for second home owners, whether the property is owned individually or through a company.

The Budget built on last year’s announcement that higher rates of stamp duty land tax (SDLT) of 3 % points above the current SDLT rates would apply to purchases of additional residential properties, such as second homes and buy-to-let properties. For those thinking of mitigating the impact of these rates by buying properties through a company, this route is being closed. The Government announced that companies purchasing residential property will also be subject to the higher rates and this will start with the purchase of a first property.

As a result of the Government’s recent consultation on these proposals for SDLT purposes, purchasers will now have 36 rather than 18 months to claim a refund from the higher rates, where they replace their main homes.

There was good news for those who inherit a small share in a property (less than 50%) and are concerned that they could fall foul of the SDLT charges. The Government has decided that when applying the higher rates, a small share (50% or less) in a single property which has been inherited within the 36 months prior to the transaction will not be considered as an additional property, where a main residence is sold and a new residence purchased.

The Government’s new lower capital gains tax rates of 10% and 20% (replacing the current rates of 18% and 28% respectively) will not apply to disposals of a second home (which does not qualify for principal private residence relief). Coupled with the forthcoming changes to mortgage tax relief for landlords (from April 2017 relief will be restricted to the basic rate of tax) the Government has increased the burden for buy to let properties or those who own a second home.