Stamp duty holiday update
Jul 15, 2020The recent announcement means that no stamp duty is payable on any residential purchase from (and including) 8th July 2020 to 31st March 2021 up to a value of £500,000.
For properties above £500,000, the duty payable will be calculated in accordance with details below:
| Property or lease premium or transfer value | SDLT rate |
|---|---|
| Up to £500,000 | Zero |
| The next £425,000 (the portion from £500,001 to £925,000) | 5% |
| The next £575,000 (the portion from £925,001 to £1.5 million) | 10% |
| The remaining amount (the portion above £1.5 million) | 12% |
Note. that 'first time buyer' relief, in existence before 8th July, will now be replaced by the above calculations.
For those buying additional homes, this sector of the market will not feel the full benefit, as the higher rate for "additional homes" will still be applied.
This 3% higher rate for purchases of additional dwellings applies on top of revised standard rates above for the period 8 July 2020 to 31 March 2021, meaning that the following rates apply:
| Property or lease premium or transfer value | SDLT rate |
|---|---|
| Up to £500,000 | 3% |
| The next £425,000 (the portion from £500,001 to £925,000) | 8% |
| The next £575,000 (the portion from £925,001 to £1.5 million) | 13% |
| The remaining amount (the portion above £1.5 million) | 15% |
Note, properties at less than £40,000 do not require production of a tax return, so no duty is payable.
The date of exchange of contracts appears to have no impact on whether the "holiday" is applied i.e. it is only the date of completion that is taken into account and provided this is between 8 July 2020 and 31 March 2021, the full benefit of the measures will be applied.
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