3rd March 2021

There was great news for homebuyers today as chancellor Rishi Sunak extended the stamp duty holiday for a further 3 months, until 30th June 2021.  As has been the case since 8 July 2020, you’ll only start to pay stamp duty on the amount that you pay for the property above £500,000 (in England & Northern Ireland). These rates apply whether you are buying your first home or have owned property before.

Furthermore, the end of the holiday will be gradual, so for the following 3 months ending 30th September 2021, the  nil rate band (the amount before stamp duty is charged) will reduce to £250,000, before returning to the usual level of £125,000 from 1st October 2021.  So if your transaction can’t quite squeeze in the current holiday, there’s another 3 months where you’ll still make a savings.

The chancellor had been urged to push back the deadline as many people have been left scrambling to complete their transactions before the end date – with the property website Rightmove estimating 100,000 could miss out.

You can use the table to work out the stamp duty due, but in simple terms a property worth £400k will have ZERO stamp duty payable, rather than £10,000 and a property at £500k will also be ZERO, rather than £15k.

If you buy a property for more than £500k then your total stamp duty bill will be reduced by £15k, with no upper limit on the purchase price to benefit from the saving.

 

Property or lease premium or transfer value SDLT rate
Up to £500,000 Zero
The next £425,000 (the portion from £500,001 to £925,000) 5%
The next £575,000 (the portion from £925,001 to £1.5 million) 10%
The remaining amount (the portion above £1.5 million) 12%

Higher rates for additional properties

The 3% higher rate for purchases of additional dwellings (such as second homes and Buy-to-Lets) still applies on top of revised standard rates above for the period 8 July 2020 to 31 March 2021.  This means that although the 3% surcharge still applies, a discount of up to £15k is available on these purchases too – which include properties purchased by limited companies.

So factoring in the extra 3% the following rates now apply for additional dwellings and limited company purchases:

Property or lease premium or transfer value SDLT rate
Up to £500,000 3%
The next £425,000 (the portion from £500,001 to £925,000) 8%
The next £575,000 (the portion from £925,001 to £1.5 million) 13%
The remaining amount (the portion above £1.5 million) 15%

 

If this has got you thinking then feel free to get in touch – we’d be delighted to help you understand your options.