Stamp Duty is a tax payable when a residential flat or house is purchased.
There is nothing payable if the purchase price is less than £125,000. If the price is more than this tax will be payable. There have been some recent changes which reduce the amount of tax considerably.
In the past the % tax paid was on the whole of the price of the house. So for example a house costing £275,000 had to pay stamp duty of 3% making the tax £8250.
Now you pay tax in bands:
Up to £125,000 0%
125,001 – 250,000 2%
250,001 – 925,000 5%
925,001 - £1,500,000 10%
1,500,001 and over 12%
The same house now will have tax of £3750 to pay following the changes. A reduction of £4500
As often happens with tax changes there are winners and losers but apart from the most expensive property most people with benefit from the changes.
These changes also have another effect. Under the old system there was a big jump in tax for a property below and above £125,000. Owners who put a house on the market at £135,000 would find they were offered £125,000 as the buyers did not want to pay any tax. Now the tax is only £200 instead of £1350 owners of houses or flats in this price range may find they are able to achieve a slightly higher price than before.
The same applies with any property that is for sale at just over £250,000. We may now see an increase in the price that can be obtained for houses around this price range as well.
Stamp Duty does also apply to commercial property but different rules apply.
If you are thinking of selling your property please contact our Estate Agents Team for a free market appraisal on 01905 425167 or via email: estateagents@parkinsonwright.co.uk To view properties for sale please visit: www.parkinsonwrightestateagents.co.uk
If you are looking to purchase a property and would like a conveyancing quote please contact QualitySolicitors Parkinson Wright on 01905 721600 or via email: fct@parkinsonwright.co.uk