You have to pay Stamp Duty Land Tax (SDLT) if you buy a property in the UK over a certain price. This is charged on all purchases of houses, flats and other land and buildings.
Chancellor George Osborne’s autumn statement changed the way Stamp Duty works. The new rules came into force on 4 December 2014.
Prior to the Stamp Duty reform no one paid stamp duty if they were buying a property for less than £125,000. After that there were five bands:
- Between £125,001 and £250,000 – a 1% charge;
- Between £250,001 and £500,000 – 3%
- Between £500,001 and £1m – 4%
- Between £1m and £2m – 5%
- Above £2m – 7%
Previously HM Revenue & Customs used a “slab structure”. This meant the rate was not just applied to the bit above the £125,00 nil rate band but the entire cost of the band rate it fell under.
New Stamp Duty Rules:
From 4 December 2014, the slab structure has been scrapped and the tax is now applied on the bit above £125,000. There are also changes to the bands.
There is still no tax on purchases up to £125,000. Above that there will be the following bands:
- Between £125,001 and £250,000 the rate will be 2%
- Between £250,001 and £925,000 the rate will be 5%
- Between £925,001 and £1.5m the rate will be 10%
- Above £1.5m the rate will be 12%
Is this good news?
The treasury indicates that this is good news for anyone buying a house costing less that £937,000, the equivalent of about 98% of households. Anyone spending more will face a higher bill under the new regime.
You can use the HMRC Stamp Duty Calculator to calculate how much Stamp Duty you will need to pay for residential purchases using the new rules effective from 4 December 2014. If also shows how much would have been due under the previous rules.
Buying a property is a journey and at Homemaker Properties our team are eager to guide you forward.
You can view a list of our current available properties on the Homemaker Properties website. We also advertise on Rightmove, Zoopla & Prime Location. If you find anything of interest and would like to arrange a viewing please contact our Sales team by phone on 02476 100 390 or by email to email@example.com.
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