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Stamp Duty changes are fairer

 
Created on 08/12/2014 @ 08:00
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Government changes to the Stamp Duty laws are seen as a fairer system by Hanratty & Co's Property Director Oliver Joseph.

The Government, in their Autumn Statement on Wednesday, announced very significant changes to the system for Stamp Duty Land Tax as regards residential property.
 
The old system had long been considered extremely unfair. A buyer, purchasing a property at £125,000, for example, would pay nothing. Another buyer, purchasing at £126,000 would pay one percent on the full value of the property; some £1,260 in tax.  


 
What the Government have introduced is, in effect, a banded system where buyers no longer pay a set percentage on the whole purchase price. Instead they pay a set percentage on the portions of the purchase price as follows:
 
First £125,000​ (Zero)
£125,000 to £250,000​ (2%)
£250,000 to £925,000​ (5%)
£925,000 to £1.5M​ (10%)
Over £1.5M​ (12%)
 
"The system therefore now works much like income tax," said Mr Joseph. "In the above example the buyer of the property at £125,000 will still pay zero tax. The buyer of the property at £126,000, however, will no longer pay £1,260. Instead they will pay 2% of that over £125,000, that being just £20.
 
"In general the system will be seen as far fairer than the previous system, although those purchasing very high value properties may be unlikely to agree. 

"Certainly for Mid-Wales the position will be that the vast majority of purchasers in the housing market will make a significant saving on Stamp Duty due to the changes."
 
For further information or any questions please contact Oliver Joseph at oliverjoseph@hanrattylaw.com

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