Just a quick update to inform you that as of midnight tonight stamp duty will be changing in the UK market.
No need to be alarmed as for most clients who buy the every person property that we recommend will actually save some money once they complete on their purchases.
George Osborne has jettisoned the old “slab” structure, by which home buyers paid SDLT on the entire purchase price of the property. Instead, he has replaced it with a “progressive” structure which, he insisted, would benefit 98% of home purchasers.
Under the new reforms:
- No SDLTL payable at all on properties up to £125,000
- The first £125,000 on properties to be free of SDLT
- Then payable at 2% payable on the portion up to £250,000
- Payable at 5% on the portion up to £925,000
- Payable at 10% on the portion up to £1.5m
- Then payable at 12% on the portion over that amount.
- The Chancellor expects the SDLT reforms to cost a total of £4.4bn in the next six years.
Savills’ calculations show the “pinch” point at being around the £1m mark, at which the new rate becomes a heavier burden on home buyers.
What does this actually mean to you, well a client buying a property under the old system would have had to pay a flat 3% on the entire purchase price so £10,500 in stamp duty.
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Under the new system, the same client will only have to pay £7,500 (0 for portion up to £125,000 + (2% on difference between £250,000 and £125,000) + (5% on the difference between £350,000 and £250,000), meaning a savings of £3,000 with this new stamp duty reform. Thanks George 🙂
Here is a nice little calculator to help you out with the calculation moving forward.
If you want more clarity on this as to how the changes will affect your off-plan purchases, feel free to give your Property Consultant a call on +44 (0)207 923 6100