New stamp duty changes from 4th December 2014!

5th December 2014

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The Treasury have released information about the newly reformed stamp duty, making it easier to understand and fairer to the majority of home buyers. Our property expert Matt at The Purple Property Shop has given us some information that may help people understand the changes.

Stamp Duty will be cut for 98% of people who pay it. The new system will mean that those who can buy the most expensive homes will contribute the most and it claims to help the majority of home buyers.

Homes under £125,000 currently don’t have to pay stamp duty and this will stay the same.
£185,000 is the average cost of a home bought under the Help to Buy scheme, the old system stamp duty is £1,850 and new stamp duty charges will be £1,200 meaning buyers will save £650!
The average family home costs £275,000 and on the old system you would’ve had to pay £8,250 stamp duty, with the new system you now pay £3,750, saving £4,500.
For those living in London the average cost of a family home is £510,000, old stamp duty used to cost £20,400 and now costs £15,500, saving the home owner £4,900.
For a home costing £2,100,000 the cost of stamp duty has increased. The old system cost £147,000 and with the new system, it now costs £165,750. Meaning an increase of £18,750.

These changes only apply to you if you are buying a home over £125,000. The changes will not affect commercial properties. The HMRC have an online calculator to help you work out how much stamp duty you will have to pay.

If you have just recently bought your property on or after 4^th December you will pay stamp duty under the new rules. If your sale completed on or before 3^rd December 2014, but you have not yet filed your stamp duty return, you will have to pay stamp duty under the old rules.

How you pay stamp duty isn’t changing, as before you will have to return and pay what you own within 30 days of completing the sale.

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