The way in which stamp duty has been enforced has seen numerous fluctuations over successive years. The Budgets’ recent announcement of the immediate exemption for first time buyers when purchasing a property less than £300,000 will of course be welcome news for those trying to gain a footing on the property ladder.
Where properties are of a value between £300,000 and £500,000; the first £300,000 will be exempt from stamp duty and the remaining £200,000 will incur a 5% fee. It is anticipated that 95% of all first time buyers will benefit from these changes, with 80% paying no stamp duty at all.
Recent years have seen the stamp duty enforcement change from a standard fee to a tiered system; the implication being that rather than one rate being applied to the entire purchase value, a range of rates were applied at successive thresholds meaning that the more expensive properties incurred greater fees and lower value properties; lower fees.
Furthermore, by April 2016 another amendment served to cool the ‘buy to let’ market through the addition of a 3 percentage point surcharge for those who were already property owners and were purchasing additional properties for investment or as holiday homes.
The Budget also referred to plans being put in place to address the housing shortage by building 300,000 extra new homes a year by the mid-2020s.
It is always advised that qualified legal advice be sought concerning any changes in stamp duty or for further information on the process and fees involved in purchasing a property.
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