As a means to support the property market during the Covid-19 pandemic, the government introduced a Stamp Duty Holiday. Last July, the government announced that Stamp Duty would be suspended on the first £500,000 on all property sales in England and Northern Ireland. This had the effect of keeping the market buoyant, even during periods of lockdown. This has saved homebuyers thousands, but at the end of March, the Stamp Duty suspension will come to an end. As a result, residential conveyancers are experiencing a period of unprecedented activity as they attempt to complete as many property transactions as possible before the holiday period ends.
What is stamp duty?
Stamp duty is a property purchase tax that’s paid across the UK, but it differs slightly in some parts of the country. In Scotland, it’s the Land & Buildings Transaction Tax and in Wales buyers pay the Land Transaction Tax. In England and Northern Ireland, homebuyers pay Stamp Duty, and its rates and application are controlled by the Westminster government.
How much do you pay?
In response to the pandemic, rates at which you begin paying stamp duty were raised to £500,000. Someone purchasing a property at that price, will pay £5,000 in stamp duty, both before and after March 31st.
If, however, you were purchasing a home at the UK average price of around £256,000, you will pay nothing before 31st March. After the 31st March, you will pay stamp duty at a rate of 5%, which works out as £2,800. Different rates apply if you are a first-time buyer, in which case you won’t begin paying stamp duty unless your property is worth over £300,000.
Most people purchasing properties in England and Northern Ireland are buying properties for less than the £500,000 cut-off for Stamp Duty relief. Therefore, if you are considering purchasing a house and hope to take advantage of this holiday it’s imperative that you act as quickly as possible. It could save you thousands of pounds.
Our award-winning residential conveyancing solicitors have over 30 years of experience helping people buy, sell and remortgage property . If you’re about to make an offer on a property, or have had one accepted, the professional conveyancing team at Murria Solicitors can help you complete your transaction as quickly as possible.
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