In September, the government announced a permanent Stamp Duty cut in England and Northern Ireland, which means no tax will be paid on the purchase of properties up to £250,000. Although most of the policies from the ‘mini-budget’ have since been scrapped, this one has stayed in place.
Back to the pandemic
During the summer of 2021, a government scheme to cut Stamp Duty helped fuel frenzied demand and record-breaking sales. The new measure was announced by then-Chancellor Kwasi Kwarteng almost a year after the pandemic-era Stamp Duty holiday ended and took effect immediately.
Higher base
The first £250,000 of a property’s value is now exempt from Stamp Duty, up from £125,000 previously. As a result, 200,000 more people will be taken out of paying the tax altogether, the government claims
Beyond that, buyers will pay 5% of the value of the home from £250,001 to £925,000 and 10% on the portion between £925,001 and £1.5m anything above £1.5 million is charged at 12%.
First-Time Buyers
The threshold for first-time buyers having to pay Stamp duty has also risen with the maximum property value to claim relief rising from £500,000 to £625,00 and the 0% band has been increased from £300,000 to £425,000 with 5% being charged on the purchase price between £425,000 and £625,000.
As an example a first-time buyer now purchasing a property for £500,000 will pay £3,750 in stamp duty.
Your home may be repossessed if you do not keep up with repayments on your mortgage.