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Stamp Duty Holiday: What has changed?

The 2021 stamp duty holiday announced by the UK government has come to an end. From now on, home buyers in England and Northern Ireland will have to pay Stamp Duty Land Tax (SDLT) on properties worth more than £250,000. The changes come into effect from 1 April 2021.

The main change is that the nil rate band for residential properties has been reduced from £500,000 to £250,000. This means that buyers of properties worth more than £250,000 will have to pay SDLT at the standard rates.

The other change is that the 5% rate for second homes and buy-to-let properties has been rested. This means that buyers of second homes and buy-to-let properties will have to pay SDLT at the higher rate of 5%, rather than the standard 3%.

The changes mean that the stamp duty holiday has effectively come to an end for most home buyers. The only people who will continue to benefit from the holiday are those buying properties worth less than £250,000.

If you’re planning on buying a property in England or Northern Ireland, it’s important to be aware of the changes to the stamp duty rules. Make sure you budget for the additional costs, and speak to a solicitor or conveyancer if you have any questions. This means that buyers of second homes and buy-to-let properties will have to pay SDLT at the higher rate of 5%, rather than the standard 3%.

The changes mean that the stamp duty holiday has effectively come to an end for most home buyers. The only people who will continue to benefit from the holiday are those buying properties worth less than £250,000.

If you’re planning on buying a property in England or Northern Ireland, it’s important to be aware of the changes to the stamp duty rules. Make sure you budget for the additional costs, and speak to a solicitor or conveyancer if you have any questions.

What changed for buyers on July 1st?

The stamp duty holiday was introduced back in July last year (2020) and it meant that buyers didn’t have to stump up any stamp duty land tax on the first £500,000 of their home purchase. That all changed last Thursday.

Now, the £500k relief has been brought down to £250,000, and the following reduced rates apply:

  • £0 to £250,000 = 0%
  • £250,001 to £925,000 = 5%
  • £925,001 to £1,500,000 = 10%
  • £1,500,000 and over = 12%

These rates will remain in place (unless further changes are announced by the government) until September 30th 2021. From October 1st onwards, they will return to their pre-July 2020 levels, which means the nil rate band will drop back down to £125,000.

So, from October 1st 2021, the stamp duty rates will look like this:

  • £0 to £125,000 = 0%
  • £125,001 to £250,000 = 2%
  • £250,001 to £925,000 = 5%
  • £925,000 to £1,500,000 = 10%
  • £1,500,000 and over = 12%
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