With immediate effect the Chancellor has announced a temporary cut to Stamp Duty Land Tax (SDLT) on the first £500,000 for all property sales in England and Northern Ireland.
The SDLT holiday will last until March 31 next year to help boost the property market and help buyers struggling in the aftermath of the coronavirus crisis. According to the Halifax, house prices have fallen for four months in a row.
The Stamp Duty Land Tax cut is welcomed
Andrea Fairweather, Partner and Property Solicitor with Birchall Blackburn Law, says: “In the past few weeks there has been a post-lockdown boom in buying and selling homes. Some of it has been pent-up demand but we’ve also seeing a lot of fresh enquiries as people emerge from the lockdown.
“Spending more time at home has really focused people’s minds on what they want from their property and lives. For some that means moving to a new home. For example, people are looking for bigger gardens, room for an office or to move closer to family. Others are looking to downsize to weather the economic uncertainty and some are looking at apartments after deciding to split from partners.
“We welcome the Chancellor’s announcement to reduce SDLT for most home buyers and to further stimulate the property market. It’s another incentive to get home buyers moving and good news for the economy. The fact that it is with immediate effect for at least six months also removes any uncertainty and speculation about the initiative, which could have stalled the current recovery.”
What is Stamp Duty Land Tax?
Stamp Duty Land Tax is a tax paid by house buyers. The amount paid depends on where you are buying in the UK, the price of the property and whether you are a first-time buyer.
In England and Northern Ireland SDLT is paid on land or property sold for more than £125,000. First-time buyers pay no tax up to £300,000 and 5% on any portion between £300,000 and £500,000.
For homeowners looking to move the SDLT rates are 2% for £125,001-£250,000, 5% for £250,001-£925,000, 10% for £925,001-£1.5m, and 12% on a property above £1.5m.
The cut will mean a saving of £2,460 in SDLT when buying the average priced home of £248,000.
People buying second homes and landlords will benefit too but will still have to pay a 3% extra duty due on the entire price.
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