Great Budget News for Homebuyers - December 2014
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The recent December budget brought a good piece of news, with a fall in stamp duty that is estimated to benefit up to 98% of homebuyers. Under the old scheme, the previous ‘slab’ charging structure meant that property buyers paid the relevant stamp duty rate on the full property purchase price. These ranged from nothing on purchases up to £125,000, through to 7% on properties over £2m. An average UK house price of £275,000, would therefore incur a Stamp Duty charge for the buyer of 3% on the full purchase price. The new rules, which took effect from midnight on 4th December, have created a tiered scale, which rises in line with your house value, to a maximum of 12% on properties worth over £1.5m. If you exchanged on your property before 4 December 2014, but complete on or after that date, you can choose whether the old or new rules apply.
The Stamp Duty changes are a bonus for many. For example, if you were buying a new home for £300,000, then under the old rules you would have paid 3% on the full value, a significant charge of £9,000.
Under the new rules, you will pay nothing on the first £125,000, 2% between £125,001 and £250,000 and then 5% on the final £50,000, a much reduced final charge of £5,000.
For full details of the changes and the stamp duty scales click here.
If you are considering buying a house, changing your mortgage or want investment advice because you are downsizing, Always Independent can offer independent financial advice.
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