The Chancellor of the Exchequer, Rishi Sunak, has announced that the stamp duty nil rate band will be increased from £125,000 to £500,000.00.
In practise, this means that, unless you are buying a second home, anybody purchasing for up to £500,000 will not have to pay any stamp duty whatsoever. This accounts for 88% of the population!
Even if you are purchasing for more than £500,000 , the amount of stamp duty that you have to pay will be substantially less. In essence, on the next £425,000 that you spend on the purchase of a property after the first £500,000, you will only have to pay stamp duty at 5%. After that, if you spend a further £575,000, you will pay 10% on that sum. If you are buying for any more than that, you will spend 12% on the remainder.
If you are purchasing a property that is not replacing your main residence, the stamp duty surcharge of 3% will still apply. However, you will still be paying less than you would previously.
Companies will also benefit from this change, as long as they meet the relief conditions from the corporate 15% surcharge.
Further details of how the standard is calculated can be accessed at the following link: https://www.gov.uk/guidance/stamp-duty-land-tax-temporary-reduced-rates#residential-rates-on-purchases-from-8-july-2020-to-31-march-2021
If you are looking to buy or sell, it is best that you instruct a solicitor sooner rather than later, as this is only a temporary arrangement and it will end on 31 March 2021.
This is going to mean a very busy time for the property market. We would be delighted to answer any questions that you have about buying or selling and/or stamp duty.