Nov 13 2020

QWhat is Stamp Duty?

A. Stamp Duty Land Tax is a tax due on the purchase of a property or land above a certain price. This varies around the UK.

You must pay Stamp Duty Land Tax (SDLT) if you buy a property or land over a certain price in England and Northern Ireland.

The tax is different if the property or land is in:

More info can be found here - https://www.gov.uk/stamp-duty-land-tax

 

Q.  What is the Stamp Duty Holiday?

A. The UK Government has agreed to waive the payment of Stamp Duty Land Tax for all properties up to £500,000. As a result, first-time buyers and home movers in England and Northern Ireland won’t pay stamp duty on the first £500,000 of the property value. The Stamp Duty Holiday is currently set to end on the 31st March 2021.

 

Q. Does this affect how much I can borrow?

A. The amount you can borrow depends on your income and outgoings.  Speaking to an adviser who can run an affordability check can help you to determine this.

 

Q. How long will the purchase process take?

A. There is no set time scale. This can depend on the type of application, whether you are self employed or employed and what type of information the lender needs to assess your application. The time scales will also depend on the time it takes the solicitors to complete the work that is necessary to complete your purchase.

 

Q. Could I miss the Stamp Duty Holiday deadline?

A. If you are looking to buy a new home, you should consider starting the process as early as possible, especially if you have a property to sell. There is a possibility of delays with lenders, solicitors, removals companies, furniture suppliers as we approach 31st March 2021.

 

Q. What if I miss the deadline?

A. If your purchase completes after the 31st March 2021, you will be liable to pay the appropriate amount of Stamp Duty, depending on the purchase price.

Rates from 1 April 2021

These rates also apply if you bought a property before 8 July 2020.

You can also use this table to work out the SDLT for the purchase price of a lease (the ‘lease premium’).

Property or lease premium or transfer value

SDLT rate

Up to £125,000

Zero

The next £125,000 (the portion from £125,001 to £250,000)

2%

The next £675,000 (the portion from £250,001 to £925,000)

5%

The next £575,000 (the portion from £925,001 to £1.5 million)

10%

The remaining amount (the portion above £1.5 million)

12%

The table above reflects rates in England and NI. Click here for Scotland or Wales.

Whether you are a first-time buyer, moving home or simply wishing to take advantage of a more competitive rate, it is important that you have the right mortgage solution. Find the perfect mortgage adviser for your needs via our nationwide search tool

 

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PRESS INFORMATION

For further information, please contact:
Andrea Barker
andrea.barker@fairstone.co.uk
/ Tel. +44 (0) 191 519 6243