Beat The Stamp Duty Deadline
Anyone buying residential property faces paying more Stamp Duty if they haven’t completed by the end of March. You need to take action now – even though the impending tax rise is still months away.
Stamp Duty Land Tax (SDLT) is set to return to its higher levels on 31st March 2025 so you could end up paying thousands of pounds extra after that.
Yes, there’s a Budget coming on 30th October 2024. But don’t bank on the current Stamp Duty holiday being extended: the Chancellor needs to fill a £22 billion hole in the economy.
Get Expert Legal Advice On Stamp Duty And Moving House
Current Rates Of Stamp Duty Land Tax
You pay Stamp Duty when you buy a property in England and Northern Ireland (different rules apply in Scotland and Wales).
SDLT applies to both residential and non-residential properties, but we’ll focus on residential property purchases in this blog post. The amount of duty you pay depends on:
- the price of the property
- whether or not you’re a first-time buyer
- whether or not you or your spouse own other residential properties.
Buyers are currently enjoying lower rates of Stamp Duty because of temporary changes brought in to support the market. These are the current SDLT rates…
Stamp Duty Land Tax For First-Time Buyers
Lower rates of SDLT for first-time buyers are tiered as follows:
- 0% on the first £425,000 of the property price
- 5% on the portion between £425,001 and £625,000.
This first time buyer relief is available only for properties under £625,000. So if you’re purchasing above this threshold, you’ll pay the same rates as a non-first-time buyer.
Stamp Duty Land Tax For Buyers Who Are Not First-Timers
The standard SDLT rates are tiered as follows:
- 0% on the first £250,000 of the property price
- 5% on the next portion between £250,001 and £925,000
- 10% on the next portion between £925,001 and £1.5 million
- 12% on any amount over £1.5 million.
Stamp Duty Land Tax For Second Home Buyers
If you’re buying an additional property – such as a second or third home – you’ll pay an additional 3% surcharge on top of the standard SDLT rates. More on this in the next section…
What Do The Impending Changes Mean For Buyers?
From 31st March 2025, Stamp Duty is set revert to its pre-discount rates:
- 0% – up to £125,000
- 2% – from £125,001 to £250,000
- 5% – from £250,001 to £925,000
- 10% – from £925,001 to £1.5 million
- 12% – on the remaining amount above £1.5 million.
You face paying a further 3% on top of these rates if you own another residential property so:
- 0% becomes 3%
- 2% becomes 5%
- 5% becomes 8%
- 10% becomes 13%
- 12% becomes 15%.
So act swiftly – your property purchase needs to complete before 31st March 2025 so you can still take advantage of the lower Stamp Duty rates.
Why You Need To Hurry
You can’t afford to delay because the average freehold residential property purchase takes between 12 and 16 weeks to complete (though we have been known to help expedite a completion in an emergency).
Remember too that leasehold purchases (such as flats) can often take longer because of the added complexities.
And that’s assuming everything goes to plan. Mortgage approval/valuation delays, chain collapses, gazumping, gazundering, leasehold complexities and a reliance on paper-based documentation can all impede the process.
On top of all that, Christmas is fast approaching. Britain’s annual Yuletide celebrations can slow things down considerably, though many people are keen to get into their new home before Santa arrives.
So you need to get a move on – literally – in October and November. Don’t waste these golden weeks!
Another Reason To Be Quick
We have nearly a century of experience when it comes to legal matters. Coles Miller traces its origins back to the late 1920s. Some of our solicitors have decades of real-world experience in residential conveyancing. (We also have significant expertise in associated residential leasehold matters too.)
And in all this time, we’ve seen all kinds of property markets. We’ve witnessed the rise and fall of many Chancellors – and the impact they can have on buying your own home.
One such Chancellor was Nigel Lawson. Back in 1988, he announced the ending of double tax relief on mortgages (aka double MIRAS – Mortgage Income Relief At Source).
The result of this tax tweak was that couples rushed to buy properties before the abolition of double MIRAS.
What happened to house prices before and after that is well documented. But we’re not here to comment on property values.
We cannot and will not speculate on what will happen to house prices over the next six to 12 months. We are solicitors, so respectfully we leave the important matter of property valuation to chartered surveyors, estate agents, valuers and auctioneers.
Our concern is about rising levels of demand in what little time remains before the aforementioned 31st March 2025 deadline (because lots of buyers have a very good reason to complete before then).
So you need to get cracking now if you want to get ahead of the herd…because the next few months are about to get very busy for lawyers who help people to move house.
Get Expert Help With Buying A Home And Moving House
Everyone knows that – even with the best will in the world – moving house can be stressful, emotional and sometimes frustrating.
So you need a calm, experienced and expert conveyancing solicitor to help you complete your purchase (and sale) as quickly and as smoothly as possible.
Get expert help from our 28-strong residential conveyancing team. They are based at Coles Miller offices across the area. Book a call back and a team member will contact you promptly.
About The Author
Coles Miller Partner Ruth Elkins has more than 25 years of experience in residential conveyancing (becoming a Partner in 2007).
Her specialisms include buying and selling houses, remortgage work and transfers of equity (following divorce, death or simply as gifts).
She helped Coles Miller to become the 100th firm in the country to be accepted on the Conveyancing Quality Scheme.
Ruth has an excellent rapport with local estate agents, brokers and other property professionals – enabling her to progress your property purchase more smoothly. She is based at our Fleetsbridge office.
