Significant reforms to stamp duty levels have been announced in today’s Autumn Statement by the Chancellor of Exchequer, George Osborne.
Stamp duty is a tax payable on any residential property purchased at a price over £125,000.
From 4th December, according to the HM Treasury, Stamp Duty will be cut for 98% of those eligible to pay it on homes purchased up to £937,000.
Previously, stamp duty would be paid at a single rate on the entire property price.
From tomorrow, only the rate of tax on the part of the property price within each tax band will be payable (like the income tax system).
Example Stamp Duty Calculation
Prior to 4th December 2014
Purchase Price – £185,000,
1% tax Stamp Duty payable on the full amount – £1,850.
After 4th December 2014
Purchase Price – £185,000
First £125,000 exempt from Stamp Duty
2% stamp duty payable on the remaining £60,000 – £1,200,
Under the new rules, in this example the purchaser would save £650.
Full details of the new rates can be found at the following link:
Stuart Taphouse – Director & Head of Residential Property, BRM Solicitors