Yesterday's Autumn Budget saw Philip Hammond announce a new regime for Stamp Duty Land Tax (SDLT) payable on residential properties by first-time buyers.
The new system came into effect immediately and provides that first-time buyers purchasing a property worth up to £500,000 will not pay any SDLT on the first £300,000.
The previous threshold before tax was paid (which still applies to non-first-time buyers) was £125,000.
By way of illustration, if someone bought their first property for £225,000 under the old regime they would have paid £2,000 in SDLT.
For the same property a first-time buyer would now pay no SDLT at all.
For a property valued at £450,000, the tax bill for a first-time buyer would have been £12,500 and this is now reduced to £7,500.
HM Treasury estimates that this change will benefit up to 95% of first-time buyers, with 80% now paying no SDLT at all.
First-time buyers lucky enough to be buying a property worth more than £500,000 will not benefit.
You can find out for yourself how much SDLT will be payable on a future property purchase by accessing HMRC's stamp duty land tax calculator at http://www.hmrc.gov.uk/tools/sdlt/land-and-property.htm
If you would like any further information please do not hesitate to contact Abigail Shortte at Wake Smith Solicitors on 0114 224 2059 or email [email protected]
