Stamp Duty Tax Update.
The new stamp duty tax cut is a permanent decision made by Chancellor Kwasi Kwarteng and one which brings a welcomed reception from the public as they face rising Mortgage rates.
What is stamp duty?
This is tax taken from the government on personal property purchases and land purchases when priced above a certain threshold.
What were the previous rates of Stamp Duty and what are they now?
Previously, for first time buyers no stamp duty tax was paid on a property up to the first £300,000, now it has been replaced by a new cap of £425,000. If you are buying a home above this as a first-time buyer, then you will only pay 5% Stamp Duty Tax on the amount between £425,000 and £625,000.
For those who have previously purchased, the previous stamp duty tax rule was applied to purchases between £125,001 and £250,000. The changes now mean that no stamp duty tax will be paid on a property under £250,000.
Properties priced between £250,000 and £925,000 for previous buyer the stamp duty tax relief is set at 5%. (5% cap up to £625,000 for first time buyers)
Properties priced between £925,000 and £1.5million will have stamp duty tax applied at 10% (Homes priced above £625,000 for first time buyers)
Properties priced over £1.5 million has a 12% stamp duty tax applied.
Rightmove.co.uk suggests “This means a third of all home currently for sale (33%) are now completely exempt from stamp duty in England, compared to 7% when the threshold was £125,000.”
Here to help
We understand this may seem confusing and you may be unsure as to whether you would be paying stamp duty or not, if so the amount. If you have any questions contact Merryweathers today on 01709 311190.
We are here to help you every step of the way.