This article is from the source 'bbc' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.
You can find the current article at its original source at https://www.bbc.co.uk/news/business-53319433
The article has changed 17 times. There is an RSS feed of changes available.
| Version 13 | Version 14 |
|---|---|
| Stamp duty holiday: How will it work? | Stamp duty holiday: How will it work? |
| (about 5 hours later) | |
| The chancellor has announced a temporary holiday on stamp duty on the first £500,000 of all property sales in England and Northern Ireland. | The chancellor has announced a temporary holiday on stamp duty on the first £500,000 of all property sales in England and Northern Ireland. |
| The tax threshold has been temporarily raised until next March to boost the property market and help buyers struggling because of the coronavirus crisis. | The tax threshold has been temporarily raised until next March to boost the property market and help buyers struggling because of the coronavirus crisis. |
| The changes have come in with immediate effect. | The changes have come in with immediate effect. |
| What is stamp duty? | What is stamp duty? |
| Stamp duty is a tax paid by people buying properties, although it varies slightly across the UK. | Stamp duty is a tax paid by people buying properties, although it varies slightly across the UK. |
| In England and Northern Ireland buyers pay Stamp Duty Land Tax. | In England and Northern Ireland buyers pay Stamp Duty Land Tax. |
| In Scotland it is Land and Buildings Transaction Tax, while in Wales buyers pay Land Transaction Tax. | In Scotland it is Land and Buildings Transaction Tax, while in Wales buyers pay Land Transaction Tax. |
| The amount handed to the government depends on where you are in the UK, and the price of the property. | The amount handed to the government depends on where you are in the UK, and the price of the property. |
| The changes to stamp duty will only apply to buyers in England and Northern Ireland. | The changes to stamp duty will only apply to buyers in England and Northern Ireland. |
| What has changed? | What has changed? |
| The government has temporarily increased the stamp duty threshold to £500,000 for property sales in England and Northern Ireland, until 31 March 2021, | The government has temporarily increased the stamp duty threshold to £500,000 for property sales in England and Northern Ireland, until 31 March 2021, |
| Anyone completing on a main residence costing up to £500,000 between 8 July and 31 March will not pay any stamp duty, and more expensive properties will only be taxed on their value above that amount. | Anyone completing on a main residence costing up to £500,000 between 8 July and 31 March will not pay any stamp duty, and more expensive properties will only be taxed on their value above that amount. |
| This will save buyers as much as £15,000, if they are buying a property of £500,000 or more. | This will save buyers as much as £15,000, if they are buying a property of £500,000 or more. |
| The move is aimed at helping buyers who have taken a financial hit because of the coronavirus crisis. | The move is aimed at helping buyers who have taken a financial hit because of the coronavirus crisis. |
| It is also intended to boost a property market hit by lockdown. According to the Halifax, house prices have fallen for four months in a row. | It is also intended to boost a property market hit by lockdown. According to the Halifax, house prices have fallen for four months in a row. |
| The average stamp duty bill will fall by £4,500, Chancellor Rishi Sunak has suggested, with nearly nine out of 10 people buying a main home this year paying no stamp duty at all. | The average stamp duty bill will fall by £4,500, Chancellor Rishi Sunak has suggested, with nearly nine out of 10 people buying a main home this year paying no stamp duty at all. |
| How much stamp duty will I pay now? | How much stamp duty will I pay now? |
| If the property purchased is your main home you won't pay any stamp duty on it at all if it costs £500,000 or less. | If the property purchased is your main home you won't pay any stamp duty on it at all if it costs £500,000 or less. |
| The next portion of the property's price (£500,001 to £925,000) will be taxed at 5%, and the £575,000 after that (£925,001 to £1.5 million) will be taxed at 10% | |
| The remaining amount (over £1.5 million) will be taxed at 12%. You can calculate how much you are liable to pay here. | The remaining amount (over £1.5 million) will be taxed at 12%. You can calculate how much you are liable to pay here. |
| Before the announcement, stamp duty in England and Northern Ireland was paid on land or property sold for £125,000 or more, while first-time buyers did not pay any stamp duty up to £300,000. But this stamp duty holiday replaces the first-time buyer discount. | Before the announcement, stamp duty in England and Northern Ireland was paid on land or property sold for £125,000 or more, while first-time buyers did not pay any stamp duty up to £300,000. But this stamp duty holiday replaces the first-time buyer discount. |
| Landlords and second home buyers are also eligible for the tax cut but will still have to pay the extra 3% of stamp duty they were charged under the previous rules. | Landlords and second home buyers are also eligible for the tax cut but will still have to pay the extra 3% of stamp duty they were charged under the previous rules. |
| How long will the stamp duty holiday last? | How long will the stamp duty holiday last? |
| This is a temporary measure designed to boost the flagging property market. | This is a temporary measure designed to boost the flagging property market. |
| It is effective immediately and will last until 31 March next year. | It is effective immediately and will last until 31 March next year. |
| However, critics worry it could encourage people who were planning to buy next year to accelerate their plans to take advantage of the tax break. This could leading to a slump in demand when the tax break ends. | However, critics worry it could encourage people who were planning to buy next year to accelerate their plans to take advantage of the tax break. This could leading to a slump in demand when the tax break ends. |
| Can I still benefit if I've already completed a purchase? | Can I still benefit if I've already completed a purchase? |
| The holiday applies from 8 July, which means anyone completing a property purchase before that date will have to pay the full normal stamp duty. | The holiday applies from 8 July, which means anyone completing a property purchase before that date will have to pay the full normal stamp duty. |
| Stamp duty is payable upon completion, so if you've exchanged contracts and are currently waiting for completion you will be able to benefit from the change. | Stamp duty is payable upon completion, so if you've exchanged contracts and are currently waiting for completion you will be able to benefit from the change. |
| How much could a buyer save? | How much could a buyer save? |
| The change will save buyers as much as £15,000, if they are buying a property of £500,000 or more. | The change will save buyers as much as £15,000, if they are buying a property of £500,000 or more. |
| Before the stamp duty holiday, if you bought a house for £275,000, for instance, the stamp duty you'd have had to pay would have been £3,750. | Before the stamp duty holiday, if you bought a house for £275,000, for instance, the stamp duty you'd have had to pay would have been £3,750. |
| That's based on 0% duty on the first £125,000, 2% on the next £125,000 (£2,500), plus 5% on the final £25,000 (£1,250). | That's based on 0% duty on the first £125,000, 2% on the next £125,000 (£2,500), plus 5% on the final £25,000 (£1,250). |
| The tax cut means anyone buying a home in Bramhall, Stockport would save £13,603 in stamp duty, based on Rightmove estimates of an average asking price of £472,053. | The tax cut means anyone buying a home in Bramhall, Stockport would save £13,603 in stamp duty, based on Rightmove estimates of an average asking price of £472,053. |
| What about Scotland and Wales? | What about Scotland and Wales? |
| In Scotland, the rates on Land and Buildings Transaction Tax are 2% on £145,001-£250,000, 5% on £250,001-£325,000, 10% on £325,001-£750,000, and 12% on any value above £750,000. | In Scotland, the rates on Land and Buildings Transaction Tax are 2% on £145,001-£250,000, 5% on £250,001-£325,000, 10% on £325,001-£750,000, and 12% on any value above £750,000. |
| Scottish landlords pay an extra 4% Land and Buildings Transaction Tax on top of standard rates. | Scottish landlords pay an extra 4% Land and Buildings Transaction Tax on top of standard rates. |
| In Wales, the rates on Land Transaction Tax are 3.5% on £180,001-£250,000, 5% on £250,001-£400,000, 7.5% on £400,001-£750,000, 10% on £750,001-£1.5m, and 12% on any value above £1.5m. | In Wales, the rates on Land Transaction Tax are 3.5% on £180,001-£250,000, 5% on £250,001-£400,000, 7.5% on £400,001-£750,000, 10% on £750,001-£1.5m, and 12% on any value above £1.5m. |
| Welsh landlords pay an extra 3% Land Transaction Tax on top of standard rates. | Welsh landlords pay an extra 3% Land Transaction Tax on top of standard rates. |
| How much does stamp duty raise? | How much does stamp duty raise? |
| The government's annual take from stamp duty is around £12bn, according to the latest figures released by HM Revenue and Customs (HMRC). | The government's annual take from stamp duty is around £12bn, according to the latest figures released by HM Revenue and Customs (HMRC). |
| That's roughly equivalent to 2% of the Treasury's total tax take. | That's roughly equivalent to 2% of the Treasury's total tax take. |
| The nine-month stamp duty holiday will cost the Treasury an estimated £3.8bn. | The nine-month stamp duty holiday will cost the Treasury an estimated £3.8bn. |