The announcement of the cut in stamp duty by the Chancellor in last week’s mini-Budget will be welcomed by those buying a property, particularly first-time buyers.
Stamp Duty Land Tax (SDLT) thresholds have been raised as part of measures unveiled by the Chancellor of the Exchequer today to boost the economy.
Fewer paying stamp duty
Chancellor Kwasi Kwarteng said that the measures will take 200,000 more people out of paying stamp duty.
The Chancellor has raised the threshold at which people begin to pay tax from £125,000 to £250,000.
Better for first-time buyers
For first-time buyers, it is even better news as there will be zero tax applicable to a property which costs less than £425,000.
For more expensive properties, the Government is allowing first-time buyers to access the relief when they buy a property costing less than £625,000 rather than the current £500,000.
The Government has stated that the measures will reduce stamp duty bills across the board for all movers by up to £2,500 with first-time buyers able to access up to £8,750 in relief.
Managing workloads important
Law Society president Stephanie Boyce said: “The announcement means conveyancing solicitors will now be watching and waiting to see how the changes announced by Government today will impact their workload and businesses.”
The Council for Licensed Conveyancers, a specialist regulator, said: “We don’t expect there to be a spike in activity like the one we saw with the pandemic SDLT holidays, but the same advice applies: Firms should always be careful to ensure that they manage workloads to maintain the highest standards of service and advice to clients.”
The changes apply only in England and Northern Ireland. Stamp duty is not applicable in Scotland, instead home purchasers pay Land and Buildings Transaction Tax, with rates set by the Scottish Government.
Wales has its own equivalent system, called land transaction tax, where the residential threshold is £180,000. There is no first-time buyer rate.
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