Chancellor George Osborne has announced that he will be reforming the stamp duty land tax from tomorrow.
Buyers will pay no stamp duty on property purchases up to £125,000;
2 per cent on the part of the property price between £125,001 and £250,000;
5 per cent on the part of the property price between £250,001 and £925,000;
10 per cent on the part of the property price between £925,001 and £1.5m
and 12 per cent on anything above £1.5m.
Reforming the unfair slab Stamp Duty system is long overdue. However, doing it practically immediately is not fair as it will hit some people hard who are part way through a transaction but not able to exchange by midnight.
We would have liked to see an amnesty for those who have made a decision to buy based on current legislation. What does it mean for people who don’t have the extra cash they are now required to pay?
We have clients nearing exchange who won’t be able to achieve it before the deadline. Given a week or two amnesty, things would have been different.
The good news is that some private banks seem prepared to be flexible when it comes to extending the borrowing to accommodate the higher stamp duty charge. If you find yourself facing a higher tax bill, it is worth getting in touch with us to discuss your options.