The U.K. government’s plan to increase sales taxes on second homes in Britain will also apply to people who live abroad.
From April, buyers of second homes and buy-to-let properties in the U.K. will be subject to stamp-duty sales tax that’s 3 percentage points higher than those who are buying a home to live in, U.K. Chancellor of the Exchequer George Osborne announced in November. In deciding whether an individual is purchasing an additional home, the government will also consider assets outside the U.K., according to a consultation document published on Monday.
“This means that if someone is purchasing their first or only property in England, Wales or Northern Ireland, they may pay the higher rates if they own property outside these areas,” the document shows.
Demand from overseas buyers has contributed to a jump in London house prices, and off-plan sales abroad helped developers finance projects including Battersea Power Station. House prices in the city rose 7.7 percent in the year through October, according to the Office for National Statistics.
The stamp-duty sales tax will rise to 15 percent from 12 percent for purchases of 1.5 million pounds or more. Tax rates of between 3 percent and 13 percent will apply to properties with a lower value, up from between zero percent and 10 percent.