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Government confirms Stamp Duty cut

New Chancellor Kwasi Kwarteng has today announced in Parliament changes to the Stamp Duty Land Tax in England and Northern Ireland.

The new changes, which are effective immediately include:

  • The house price at which stamp duty becomes payable has increased from £125,000 to £250,000.
  • There is additional benefit for first-time buyers, who will not have to pay stamp duty up to the house price of £425,000 – and will also have further discount applied to properties costing up to £625,000 (up from £500,000).

Therefore the current rates are now:

  • 0%: £0 – £250,000 (£425,000 for first time buyers)
  • 5%: £250,000 – £925,000
  • 10%: £925,000 – £1,500,000
  • 12%: £1,500,000+

Stamp Duty is the tax that you pay when purchasing a property, and the amount depends on the cost of the property. Rates in Scotland and Wales are and remain different.

Unlike the previous stamp duty cuts that the government put in place as a response to the COVID-19 pandemic back in 2020 and 2021, these changes have been presented as permanent rather than just a holiday.

For those currently buying a property, these changes will have an immediate impact on their matter. Head of Residential Property at Fosters Solicitors, Rebecca Laws, explains: “With these changes coming into place immediately, we will be revisiting stamp duty land tax charges for all clients who are affected, starting with those who are completing now or have exchanged contracts with a fixed completion date.

With rumours about stamp duty having been circulating in recent days, we’ve had several clients wish to understandably hold fire on exchanging contracts until the situation was confirmed – and for those completing today and moving forward this will of course be hugely welcome news.

“We will of course await to see what impact this news has on the wider housing market, and as always help support our clients to navigate this as part of our specialist residential conveyancing service.”

If you are thinking of buying or selling a property, and would like advice, please contact our Residential Property team for a free no obligation quote by calling 01603 620508, or click here for our simple online quote page.

For more information about our Residential or Commercial Property services, follow the links.

This article was produced on the 23rd September 2022 by our Residential Property team for information purposes only and should not be construed or relied upon as specific legal advice.