The Stamp Duty announcement in the Chancellors Autumn Statement will see the majority of homeowners saving thousands when moving home. George Osbourne said that he would be completely reforming what he described as a “badly designed tax on aspiration”.
This new reform will mean that home purchasers will pay stamp duty according to a tiered system rather than a single rate on the entire property purchase price as had previously been the case.
In summary, the new rates mean that you will only pay the rate of tax on the part of the property within each tax band – just like income tax:
- Purchasers buying property up to £125,000 will still pay no stamp duty
- Will only pay 2% on the portion from £125,001-£250,000
- Pay 5% on the portion from £250,001 to £925,000
- Pay 10% on the portion from £925,001 to £1,500,000
- And finally pay 12% on the portion over £1,500,001
The Chancellor claims that this change will benefit over 98% of people who pay it, and could equate to a saving of several thousands of pounds on the stamp duty costs for some home owners.
It may sound complicated but the HMRC will shortly have a handy online calculator which can help you calculate the new rates or talk to your solicitor or conveyancer.