On 8 July 2020, the Chancellor, Rishi Sunak, announced temporary changes to Stamp Duty Land Tax (SDLT) taking effect from 8 July 2020 until 31 March 2021 inclusive. In what has now become known colloquially as the Stamp Duty holiday, the threshold at which SDLT becomes payable on a property has been increased from £125,000 to £500,000 during this period.
 

What does this change mean?

In his speech, Mr Sunak stated that nearly 90% of people who buy a property (both first-time buyers and previous owners) before 1 April 2021 will pay no SDLT at all, with buyers saving an average of £4,500.

As this is a time-limited offer, it does mean that those looking to take advantage are going to have to get their transaction moving as quickly as possible.
 

What are the new Stamp Duty rates?

Until 31 March 2021, the Stamp Duty due on your property purchase will be calculated as follows:
 

Property lease premium or transfer valueSDLT rate
Up to £500,000Zero
£500,001 to £925,0005%
£925,001 to £1.5 million10%
Anything above £1.5 million12%

 

This means that, not only will the vast majority of buyers pay no Stamp Duty whatsoever, but even those whose homes are valued at more than £500,000 will see their bill reduce as they will not be taxed on the portion from £125,000 to £500,000.
 

Is the higher rate for additional properties affected?

While the change does not apply completely to Stamp Duty payable on second homes, the rate payable for buyers of additional properties has also been reduced.

This is because the 3% SDLT surcharge for second homes will apply on top of the revised standard rates above. The total Stamp Duty payable can therefore be calculated according to the below table:
 

Property lease premium or transfer valueSDLT rate
Up to £500,0003%
£500,001 to £925,0008%
£925,001 to £1.5 million13%
Anything above £1.5 million15%

 

How can I take advantage?

Moving quickly on your property transaction will be key to taking advantage of this generous but time-limited offer. Instructing a team of expert conveyancers, who have years of experience in progressing property transactions swiftly from instruction to completion, will therefore be essential to ensuring you save thousands of pounds worth of Stamp Duty.

Our expert Residential Property team, including our Partner Sheri-Anne Mizon, understand that buying a property is often the most significant purchase most people will make, especially as many will now be scrambling to take advantage of the SDLT holiday. With years of experience in a huge variety of conveyancing transactions, rest assured that we will act quickly and professionally to take your home move through to completion, keeping you informed every step of the way.
 

Get in touch

To get the ball rolling, contact our Partner, Sheri-Anne Mizon, who has over two decades’ experience in complex Residential Property cases. Call her on 0203 871 0007 or email her at sheri-anne.mizon@attwaters.co.uk.

 

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