Chancellor Rishi Sunak’s decision to extend the stamp duty holiday, on all homes under £500,000 until the 30th June 2021, will save home buyers thousands of pounds. This will also help to boost the property market and aid individuals who are struggling to buy due to the Coronavirus outbreak.
The stamp duty holiday will be extended from the end of March until the end of June, then a new £250,000 threshold will apply until the end of September. After that the threshold returns to the usual level of £125,000 from October.
Mr Sunak stated that “the average stamp duty bill will fall by £4,500 and nearly 9 out of 10 people buying a main home this year will pay no stamp duty at all.”
This stamp duty holiday only apply to buyers in Northern Ireland and England.
What is stamp duty?
Stamp duty is a tax that anyone buying a property over a certain price must pay. How much tax you pay will depend on the price of the property that you are purchasing.
This levy is normally paid on land or properties that are sold for £125,000 and over. However, first time buyers do not pay tax on purchases up to £300,000.
However, the usual stamp duty rates have been replaced by those below.
|Tax Band Based House Price||Normal Rate|
|Up to £500,000||0%|
|The next £425,000 (the portion from £500,001 to £925,000)|
|The next £575,000 (the portion from £925,001 to £1.5 million)||10%|
|The remaining amount (the portion above £1.5 million)||12%|
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