(58)
Leave us a review
Leave us a review
Stamp Duty is always a hot topic of conversation, and the last few months have been no exception.
In August it was speculated that the Chancellor, Sajid Javid was floating the idea of shifting the responsibility of stamp duty on to sellers, a rather controversial move that he later denied. September saw Zoopla publish an analysis speculating that stamp duty was to blame for a large fall in the number of cash buyers, and HMRC has revealed that that their receipts from SDLT (Stamp Duty Land Tax) in 2018-19 has fallen by 7%.
Stamp Duty is often seen as the weak link that binds the market’s progress, but what is it exactly?
Stamp Duty is a lump sum tax that is paid upon purchasing a property or land. The rate you pay is subject to the value of the property or land, and the type.
In England and Northern Ireland, the tax applies to homes sold for £125,000 or more. However, first-time buyers pay no tax up to £300,000 and 5% on any portion between £300,000 and £500,000. It is worth noting that a first time buyer is classed as someone who has never owned or inherited a property, anywhere in the world, and does not have the intention to rent it out. Additionally, if you are co-purchasing you both need to be eligible first-time buyers to get First-Time Buyers Stamp Duty relief. This tax applies to freehold and leasehold homes, whether you are buying outright or with a mortgage.
Buyers of additional properties, whether second home or buy-to-let, are subject to an extra 3% duty on top of current SDLT bands. If you buy a new main residence but there’s a delay in selling your previous main residence, you’ll have to pay the higher Stamp Duty rates as you’ll now own two properties. However, you can apply for a refund for the higher rate SDLT if you sell your property within 3 years.
You have 14 days after purchase is completed to file a SDLT return and pay your duty. Any delay after this and you may be subject to penalties. Usually, your solicitor will deal with your stamp duty return.
Miss. Claire White
W. Why Media
E. claire@whymedia.com