Stamp Duty, also known as Stamp Duty Land Tax (SDLT), is a charge that applies when purchasing a residential property in the UK.
On 8 July the Government announced that homebuyers in England and Northern Ireland will not have to pay stamp duty on homes up to £500,000 until 31 March 2021.
This stamp duty holiday applies to both first-time buyers and those who have previously owned a home.
The former threshold for paying Stamp Duty was £125,000, or £300,000 for first-time buyers (if the property was worth less than £500,000).
If you are looking to buy a property costing more than £500,000, you will pay the Stamp Duty rate based on the value of the property over £500,000. But this still means you’ll be saving a hefty £15,000 compared to the previous rates.
With big savings on Stamp Duty, your dream Countryside property could be more affordable than you thought.
Temporary Stamp Duty rates from 8 July 2020 until 31 March 2021
If you are purchasing a buy-to-let property or a second home (that is not a replacement for your main residence) that costs more than £40,000, you will still pay the additional 3% Stamp Duty surcharge.
The charge applies regardless of whether the property is new or second hand, and the amount you pay depends on the purchase price. Stamp Duty also applies to both freehold and leasehold properties and whether you are using a mortgage or buying with cash.
Scotland and Wales have slightly different systems for stamp duty. In Scotland Stamp Duty is referred to as the Land and Buildings Transaction Tax (LBTT) and is charged when you buy a home of more than £145,000, or £175,000 if you are a first-time buyer.
In Wales Stamp Duty is referred to as the Land Transaction Tax (LTT) and applies to home purchases of more than £250,000.