Chancellor announces changes to stamp duty land tax for first-time buyers but with no changes for the rest of the market
As had been hinted at over the weekend, in today's Autumn Budget, Phillip Hammond has announced changes to Stamp Duty Land Tax ("SDLT") to assist first time buyers to be known as "Discount Relief". For purchases by first time buyers completing on or after 22 November 2017 there will be no SDLT on the properties purchased by first-time buyers up to a limit of £300,000. A saving of up to £5,000.
Acknowledging that in certain areas the average house price is higher than the national average there is a further relief in relation to properties up to £500,000. For these properties, SDLT will only be charged on the element of the purchase price between £300,000 and £500,000. SLDT will be charged on this element at the normal rate of 5%. This means that a first time buyer buying a property for £500,000 will pay SDLT of £10,000, as opposed to £15,000. Again a saving of £5,000.
For first- time buyers, purchasing properties worth over £500,000 there will be no relief.
The Chancellor has said that 95% of first-time buyers will benefit and 80% of people buying their first home will pay no SDLT at all.
The good news for the rest of the market is that there have no increases to the SDLT charge in respect of the remainder of residential or commercial SDLT to fund the cost of providing this relief.
For professional advice on SDLT, please contact John Shallcross.