Everything You Need to Know About The Stamp Duty Holiday

Stamp Duty has been a highlight in the news in recent weeks, but it can be confusing topic to navigate. The introduction of reduced rates has become a huge talking point across the country, so we thought we’d give you all the information you need and an insight to the savings you could make with the new Stamp Duty thresholds.

Manning Stainton

What is Stamp Duty?

Stamp Duty is a lump sum tax to be paid by anyone buying a property (exc First time buyers purchasing a property up to £300,000). The amount you pay varies based on the property price. Prior to the current reductions Stamp Duty price brackets were as followed: -

Stamp duty chart

What are the new changes to Stamp Duty?

On the 8th of July, the Government announced a reduction in Stamp Duty to apply until 31st of March 2021.  The chancellor introduced the Stamp Duty holiday to help boost the economy from the damaging effects of the Coronavirus pandemic. During this 9-month period, homebuyers will not be required to pay Stamp Duty when buying a main home up to the value of £500,000.

Properties purchased for above £500,000 will also benefit from the increased threshold, take a look at the table below to see the new rates.

Stamp duty chart

Who do the new reductions apply to?

Anyone who is buying their main property during this time frame is eligible for the reduction in Stamp Duty.  The reduced rates discussed in this article only apply to England, too see Scotland and Wales rates please see here.

What happens if the property I’m purchasing is over £500,000?

For properties priced between £500,001 to £925,000 you will be charged 5% Stamp Duty on the portion above £500,000. For the next £575,000 on properties with a value of £925,001 to £1.5 million you will be charged 10% Stamp Duty and the remaining amount for properties above £1.5 million you’ll be charged a rate of 12% in Stamp Duty. 

See examples below:

Stamp duty chart

What if I’m purchasing an additional property?

If you are purchasing an additional property whether it be a second home for yourself or a buy-to-let property, you will be required to pay an extra 3% in Stamp Duty on top of the revised rates. However, you will still benefit from the increased thresholds up until the 31st March 2021. The increased rate applies to properties purchased for £40,000 or more.

For example, before July 8th 2020 if you were purchasing a second property with a value of £250,000 you would have paid 3% on the first £125,00 and 5% on the remaining £125,000 giving you a total bill of £10,000. However, with the new revised rates you will pay 3% Stamp Duty on the full £250,000 giving you a total bill of £7500, making a saving of £2500.

What does this mean for me, how much could I save?

If you’re thinking of moving, the Stamp Duty Holiday could give you a significant saving. The Chancellor expects that the average household will save £4500 with the revised thresholds but those purchasing properties with a value of £500,000 will make a saving of £15,000.

If you’re a landlord or looking to buy a second property you will also benefit from the reductions making it a great time to start looking.

We’ve put together a list of properties currently on the market that all fall under £500,000 giving you a 0% Stamp Duty rate.

If you would like anymore advice on your property search, contact your local branch.

Properties Under £200,000

Town Gate Close, Guiseley - £199,950 | View More

House in Guiseley

Bishop Way, Tingley - £195,000 | View More

House in Tingley

Bryan Street, Farsley - £189,950 | View More

House in Farsley

Properties under £300,000

Temple Court, Wakefield - £280,000 | View More

House in Wakefield

Kirkstall Hill, Burley - £295,000 | View More

House in Burley

Tower Lane, Upper Armley - £289,995 | View More

House in Upper Armley

Properties Under £400,000

Scotland Way, Horsforth - £389,950 | View More

House in Horsforth

Badgerwood Glade, Wetherby - £359,950 | View More

House in Wetherby

West Park Drive West, Roundhay - £375,000 | View More

House in Roundhay

Properties under £500,000

Hollin Hill House, Oakwood - £499,999 | View More

House in Oakwood

Station Lane, Woodlesford - £479,995 | View More

House in Woodlesford

Shadwell Lane, Shadwell - £450,000 | View More

House in Shadwell

To view all the properties currently on the market for under £500,000 see here

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