For first-time home buyers, the expenses associated with buying a new home can be burdensome. As a result, the government recently introduced measures to boost economic growth while helping first-time buyers in the process. Many residential buyers and first-time buyers alike will see significant savings. If you’re interested in taking advantage of these new SDLT measures, please contact our highly-experienced and friendly conveyancing team now.
Stamp Duty Land Tax: What’s changing?
In September 2022, the government cut Stamp Duty Land Tax (or SDLT) for those purchasing a residential property by double the level at which people start paying this tax from £125,000 to £250,000.
Moreover, the government increased the level first-time buyers start paying SDLT from £300,000 to £425,000.
Furthermore, the government is enabling first-time buyers to access SDLT relief when they purchase a property costing less than £625,000 (as opposed to the current £500,000).
SDLT Changes: What does this mean for residential buyers?
The latest SDLT measures will reduce stamp duty bills for a wide variety of residential buyers and first-time buyers alike (with first-time buyers saving up to £8,750 in relief).
Mini Tax Budget Reversals: Stamp Duty Land Tax Remains Unchanged
While most tax cuts that were announced on 23 September 2022 were reversed by Chancellor Jeremy Hunt MP, on 17 October 2022, changes to Stamp Duty Land Tax remain unchanged.
Here’s a table that outlines SDLT rates from 23 September 2022
|Standard Residential Rates
|£0 – £250,000 (£425,000 for first-time buyers buying a property worth £625,000 or less)
|£250,000 – £925,000
|£925,000 – £1,500,000
What is Stamp Duty Land Tax?
SDLT is a mandatory tax paid to His Majesty’s Revenue and Customs (HMRC) on the purchase of a property. The buyer is responsible for funding this payment. SDLT is payable within 14 days from the effective date of your transaction (which is the date the property purchase completes). Your solicitor or conveyancer will facilitate this payment to the HMRC on your behalf, and add it to your bill, so you can have peace of mind throughout your transaction.
Who qualifies as a first-time homebuyer?
First-time buyers must be purchasing a property that intends to serve as their main residence. It must also be the first property you own in the UK or elsewhere in the world. Note that if you have previously inherited a residential property or intend to use your new property as a buy-to-let investment, you will not be eligible for first-time buyer SDLT relief.
Contact JPGoldman to Learn More
If you’d like to take advantage of the recent changes, or if you have questions about buying your first residential property with a spouse, please contact our experienced conveyancing team at JPGoldman.