On Wednesday 8 July 2020, Chancellor Rishi Sunak announced the temporary change in the Stamp Duty Land Tax (SDLT) threshold in an attempt to ‘reinvigorate’ the housing market. The SDLT threshold for residential conveyancing transactions will increase from £125,000 to £500,000 until 31 March 2021. The rate for first time buyers increased from £300,000 to £500,000. Second home or corporate buyers will also benefit from the increased threshold on SDLT for properties valued up to £500,000.
Where properties are above £500,000, the standard SDLT rates and thresholds continue to apply. For second home buyers, the existing 3% second home surcharge will continue to apply on properties up to £500,000.
A second home buyer purchasing a property of £750,000 would pay SDLT of £35,000 instead of £50,000. Companies will also benefit from these changes where they are not subject to the flat 15% rate.
New SDLT rates from 8 July 2020 to 31 March 2021:
|PURCHASE PRICE||RATE OF STAMP DUTY||RATES WITH THE 3% SURCHARGE|
|Up to £500,000||0%||3%|
|£500,001 to £925,000||5%||8%|
|£925,001 to £1,500,000||10%||13%|
|£1,500,001 and above||12%||15%|
Stamp Duty Land Tax has to be paid within 14 days of completion of your purchase otherwise penalties apply. If you are considering taking advantage of the new rates and purchasing a property then please email us today or contact the residential property team on 020 8858 6971.