Stamp Duty Reform

From midnight on 3 December, Stamp Duty will now be calculated differently. These changes are promised to benefit 98% of buyers as they will see the Stamp Duty owed on their purchases from now onwards cut.

George Osborne made the announcement yesterday, explaining that the new system will function in a similar way to income tax. Under the old system, the Stamp Duty payable was calculated on the whole amount of the purchase price, meaning that a price difference of just a few pounds could see the fee jump significantly.

Now, the different rates will apply just to the part of the purchase price that fits within each band. According to the BBC, the amount a person buying the average home in London can expect to save is £4,900*.

The new rates are set out here:

  • No stamp duty due on the first £125,000 of a property
  • 2% due on the portion up to £250,000
  • 5% due for the portion up to £925,000
  • 10% due on the portion up to £1.5m
  • 12% due on anything above that

HM Revenue and Customs have also created a tool which allows you to calculate the amount to be paid:

http://www.hmrc.gov.uk/tools/sdlt/land-and-property.htm

If you are considering buying or selling a home, please contact Jagruti Raval at Garside & Hoy on 0208 427 5656 or email info@garsideandhoy.co.uk for a quote.

*Based on the average London purchase price of £510,000.

Share