I am buying a property and am liable to paying Stamp Duty Land Tax. How will the recent changes affect the amount I pay?
Stamp duty on home purchases has now been reformed following the Autumn Statement announcement by the Chancellor.
Previously Stamp Duty Land Tax was charged on the whole of the purchase price of the property and the rates chargeable ranged from one per cent on properties between up to £125,000 and £250,000 to seven per cent on properties worth over 2 million.
For example, if you were purchasing a property for £220,000, the Stamp Duty Land Tax payable would be £2,200, which is one per cent of the total purchase price.
The rates and bands have now been adjusted and, rather than paying Stamp Duty Land Tax based on the total purchase price of the property, each rate of tax is payable on the portion of the purchase price which falls within the relevant band. The rates and bands have been adjusted to take the change into account.
Therefore, using the new rates for a property being bought for £220,000, the total Stamp Duty Land Tax will be £1,900, i.e two per cent of the difference between £125,000 and £220,000.
When the Chancellor announced the change, he said that as a result, Stamp Duty Land Tax will be cut for 98 per cent of house buyers. On average, someone buying a home in England and Wales will now pay £4,500 less in stamp duty, good news for almost everyone.
For further information on how to ensure your sale of property is legally watertight contact Graham Ireland on 01254 272640 or email graham.ireland@whnsolicitors.co.uk
