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Stamp duty saving

Available until 30th June 2021

The temporary increase to the nil rate band for Stamp Duty Land Tax has been extended by the UK Government. Rather than ending on 31st March 2021, the temporary nil rate band of £500,000 will now be in place until 30th June 2021.

Then from 1st July 2021 to 30th September 2021 the nil rate band will be £250,000.

The nil rate band will return to the standard amount of £125,000 on 1st October 2021.

If you purchase a residential property (including a retirement property) between 8th July 2020 and 30th June 2021, you only start to pay SDLT on the amount that you pay for the property above £500,000. The reduced rates mean savings of up to £15,000 on the cost of buying your new home. These rates apply whether you are buying your first home or have owned property before.

What this means is savings of up to £15,000 on the cost of buying your new home, and zero Stamp Duty Land Tax if the property you are buying is less than £500,000, regardless of whether it's your first home or your last.

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Stamp duty on a retirement property

Stamp duty on a retirement property

How and when do I have to pay Stamp Duty?

Stamp Duty Land Tax is payable within 14 days of completion of a property purchase. A mortgage provider cannot lend towards Stamp Duty. It must be paid in full within 14 days of completion. As a buyer you can choose to file the return yourself directly to HMRC, although your solicitor will usually take care of this for you.

Does Stamp Duty apply if I buy a retirement property in an Audley village?

Yes. Stamp Duty is a legal requirement upon completion of any property purchase. Audley property experts in the village are well-versed in the sale and purchase of retirement properties and can provide advice and support when it comes to buying property, as well as selling your previous property or properties.

What if the property I choose is over £500,000?

If the property is more expensive than £500,000, you only have to pay Stamp Duty on the amount above £500,000, which means you still pay a significantly reduced SDLT.

  • For properties valued at up to £500,000 - You pay zero SDLT
  • Between £500,001 and £925,000 - You pay 5% on anything above £500,000
  • Between £925,001 and £1.5million - You pay 10% on anything above £500,000
  • Anything above £1.5million - You pay 12% SDLT on anything above £500,000

For example: If you were to purchase a property for £800,000, you would pay 5% Stamp Duty on the £300,000 (£800,000 minus the £500,000, because it's not payable on the first £500,000). So you would pay £15,000 in SDLT as opposed to the previous rate before the scheme was introduced in July 2020 (now extended until 30th June 2021). If it were your second property, you would pay 8% Stamp Duty.

What if I am buying a second property?

If your purchase is an additional dwelling, then there are higher rates applied on top of the standard rates. This is generally 3% on top of the standard rates above.

  • Up to £500,000 - You pay 3% SDLT in total if buying an additional property (an additional 3% on top of the standard rates)
  • Between £500,001 and £925,000 - You pay 8% SDLT in total on anything above £500,000 (an additional 3% on top of the standard rates)
  • Between £925,001 and £1.5million - You pay 13% SDLT in total on anything above £500,000 (an additional 3% on top of the standard rates)
  • Anything above £1.5million - You pay 15% SDLT on anything above £500,000 (an additional 3% on top of the standard rates)

Read the detail on the Gov.uk website and view the Stamp Duty Land Tax calculator

What is Stamp Duty?

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 Scotland or Wales.

You pay the tax when you;

  • Buy a freehold property
  • Buy a new or existing leasehold
  • Buy a property through a shared ownership scheme
  • Are transferred land or property in exchange for payment, for example you take on a mortgage or buy a share in a house
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