Kwasi Kwarteng, Chancellor of the Exchequer, has announced in today’s ‘mini-budget’ speech the relaxation of Stamp Duty Land Tax rules which are likely to benefit thousands of home-movers over the coming months.
As the cost of living crisis tightens and mortgage interest rates are on the rise; this news will be welcomed by buyers who without these measures could have been thousands of pounds worse off.
These changes are effective from today (Friday, 23 September 2022).
How is Stamp Duty Land Tax changing?
The Stamp Duty Land Tax nil rate bank has been permanently increased from £125,000.00 to £250,000.00 for all property buyers.
The Stamp Duty Land Tax bands, therefore, now stand as follows:
- £0 – £250,000.00 – NIL RATE
- £250,001.00 – £925,000 – 5%
- £925,001.00 – £1,500,000 – 10%
- Above £1,500,001 – 12%
According to the Government, this action will mean:
“a standard buyer in England will save £2,5000, meaning a typical family moving into a semi-detached property will save £2,500 on stamp duty and £1,150 on energy bills – and if they have a combined income of £50,000 around an additional £560 on tax. This is around £4,200 in total”.
Changes to first-time buyer relief
Additionally, the Government will introduce further financial support for first-time buyers, who meet the HM Revenue & Customs criteria, which include:
- The purchase must be a residential property
- The purchase price must not exceed £625,000.00 an increase of £125,000.00 on the previous relief
- The buyer must intend to occupy the property as their only or main residence
- The buyer must not have previously had, at any time, a major interest in a property anywhere in the world
First-time buyers that satisfy the above criteria will be eligible for relief from all Stamp Duty Land Tax payable on a purchase price of up to £425,000.00, this is an increase of £125,000.00.
Where a first-time buyer purchases for over £425,000.00 they will pay five per cent Stamp Duty Land Tax on the proportion from £425,000.00 to the purchase price.
How can we help?
Chris Huntingford is a Partner at Nelsons and heads our Residential Conveyancing team.
For further information regarding the subject discussed in this article, please contact one of our conveyancing solicitors in Derby, Leicester and Nottingham on 0800 024 1976 or via our online enquiry form.
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