With immediate effect the new Stamp Duty Land Tax (SDLT) threshold of £500,000 will apply and will run until 31 March 2021. This means any buyer purchasing a primary residential property between 8 July 2020 and 31 March 2021, up to the value of £500,000, will be exempt of paying Stamp Duty.
Peter Davey, Director of James Anderson says, according to a release by the Government the exemption will apply to all primary residential property purchases, so regardless of whether the purchaser is a first-time buyer or someone who has owned a property before.
He adds that on purchases over the £500,000 threshold, buyers will pay a 5% SDLT on the portion from £500,001 to £925,000, 10% on the portion from £925,001 to £1.5 million and 12% on any portion over £1.5 million.
When it comes to purchasing a second home, the Government has introduced higher additional rates with a 3% higher rate on top of the new revised standards. “So, what this means is that people purchasing a holiday home up to the threshold value of £500,000 will pay 3% SDLT. Those buying a second home over the threshold with pay 8% on the portion from £500,001 to £925,000, 13% on the portion from £925,001 to £1.5 million, and 15% on the remaining portion over £1.5 million.
From 1 April 2021, the SDLT holiday will come to an end and the SDLT regulations will revert to what they were before these temporary changes were announced. “We have already noticed an increase in activity’’, says Davey ‘’with buyers looking to make the most of the opportunity the SDLT holiday provides,”
You can visit the Government website to calculate SDLT here.
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