Stamp Duty Holiday Update
In July 2020, Chancellor Rishi Sunak announced a raft of measures worth up to £30 billion as part of his plan to rescue the economy amid the coronavirus pandemic. This included a stamp duty holiday in a bid to boost the housing market and kickstart the economy, whereby the threshold for paying stamp duty was raised from £125,000 to £500,00.00.
This scheme was aimed at helping home buyers save thousands of pounds in stamp duty tax, in the hope that individuals would then have surplus funds to put into other parts of the economy. This has assisted in helping other parts of the economy including moving companies, plumbers, electricians and mortgage brokers to name a few!
What is stamp duty?
Stamp duty land tax is a lump sump payment those buying a property or piece of land over a certain price have to pay.
The threshold for when you have to pay stamp duty when buying your main residential home was increased from £125,000.00 to £500,000.00 and this temporary change was to run from 8th July 2020 to 31st March 2021.
The Chancellor then announced in his March 2021 budget that the stamp duty holiday was to be extended. This was hoped to stop transactions falling apart and to continue boosting the economy.
What are the rules after 30th June ?
From 1st July to 30th September, the threshold is being decreased from the £500,000 to £250,000. This is to help the housing market stay afloat, and give a tapered effect to the normal stamp duty rules coming back into place in October 2021.
Although the measure is temporary, it is thought it will have a lasting impact on the housing market and the market has been booming over the last year with many reporting that houses are receiving multiple offers before even going to the open market, and delays with transaction due to the current volumes.
The rates if you buy a second home or a buy to let have also changed and are now 3% up to a value of £500,000. There are also different rules if you are a first time buyer.
If you have any questions, then please give our property team a call.