Tomorrow’s Stamp Duty changes!
Today marks the last day of the main stamp duty holiday, with the tax break becoming much less generous in England from tomorrow. Find out all you need to know about how stamp duty works, if you'll need to pay it, and what happens when the holiday ends…
Main stamp duty holiday finishes in England today
In response to the coronavirus pandemic, the thresholds at which you start paying stamp duty in England were temporarily increased. Stamp duty holiday in England runs in its current format until 30th June (TODAY) and is tapered after that.
The stamp duty holiday in England has been running in its current format since last summer, but it'll become much less generous from tomorrow (1st July). This is how it works:
- Until 30th June (TODAY). No stamp duty will be due on the first £500,000 of any primary residential property.
- From 1st July (TOMORROW) until 30th September. No stamp duty will be due on the first £250,000 of any primary residential property – though it's higher if you're a first-time buyer.
- From 1st October. The stamp duty holiday ends on 30th September, and normal stamp duty rates apply after.
You need to have completed your property purchase by 30th September to benefit from the stamp duty holiday. If you exchange on or before 30th September, but complete after 30th September, then you'll have missed the deadline and will need to pay the normal rate of stamp duty.
This is what the stamp duty rates will be from 1st July (tomorrow) until the end of September:
PURCHASE PRICE: Up to £250,000 (up to £300,000 for first-time buyers)
RATE ON MAIN RESIDENCE: 0%
RATE FOR ADDITIONAL PROPERTIES: 3%
PURCHASE PRICE: £250,001 – £925,000
RATE ON MAIN RESIDENCE: 5%
RATE FOR ADDITIONAL PROPERTIES: 8%
PURCHASE PRICE: £925,001 – £1,500,000
RATE ON MAIN RESIDENCE: 10%
RATE FOR ADDITIONAL PROPERTIES: 13%
PURCHASE PRICE: £1,500,001 +
RATE ON MAIN RESIDENCE: 12%
RATE FOR ADDITIONAL PROPERTIES: 15%
(1) Rate applies to that portion of the purchase price. (2) Additional properties bought for less than £40,000 will be charged the main residence rate of stamp duty. (3) The £300,000 first-time buyer stamp duty threshold does not apply if the property you are buying costs more than £500,000 – if it does, you'll pay the normal rate of stamp duty.
How much stamp duty does a first-time buyer pay?
Until today, first-time buyers in England didn’t pay stamp duty on the first £500,000 of a main residential property. From tomorrow onwards, no stamp duty for first-time buyers on the first £300,000 of a main residential property.
How can I speed up my property transaction?
There are many steps to home buying. Here are some ways to speed up the process in order to complete in time to benefit from the stamp duty holiday:
· Find an estate agent with a good track record.
· Get a mortgage agreement in principle before you make an offer on a property.
· Sellers should instruct a solicitor as soon as you list while buyers should instruct a solicitor as soon as your offer is accepted.
· Get all your paperwork together E.g., sort your Energy Performance Certificate.
· Consider homebuyer protection insurance which will cover you for some of your legal, survey and mortgage costs if your sale falls through.
Get in touch
We’re here to help if you have any questions or queries about the changes, or want to get your home move started to take advantage of the reduction in stamp duty tax. We can also calculate the exact amount you’ll pay so you can be prepared in your budget, whether you’re a first-time buyer, selling a home and buying another, or a landlord.