At the moment, those who are looking to purchase property are not obligated to pay an extra lump sum of fees thanks to the government’s stamp duty holiday.
Revealed last year during the beginning of the coronavirus pandemic, it is believed the scheme was released in aid of those wanting to buy a property during this difficult period and encourage them to go through with the purchase, thus keeping the property market afloat.
This means that anyone completing a purchase on a property costing up to £500,000 before the deadline, originally set to be March 31st, will not pay any stamp duty and more expensive properties will only be taxed on their value above that amount. Meaning buyers can save as much as £15,000!
Will the deadline be extended?
Yes, in recent new The Chancellor, Rishi Sunak, announced in his budget that the stamp duty holiday on house purchases has been extended for a further three months. Great news for those who have recently bought a property and the transaction was due to go through after March 31st.
The property purchase tax has been suspended on the first £500,000 of all sales in England and Northern Ireland since July. The tax break will now continue until the end of June, after that the nil rate band will be set at £250,000, double its standard level until the end of September.
What happens after the deadline?
Analysis by Rightmove suggests that around 100,000 buyers would have missed out on the stamp duty saving, if the deadline was still to be March 31st. Depending on how quickly your transaction will go through, and how easy your property case will flow, it may mean you miss out on the Stamp Duty holiday unless you are a first-time buyer purchasing a property under £500,000.
If you are going to miss out on the deadline, it is expected that any transaction completing after the end of June will be subject to the Stamp Duty payment due at that time.
How much will I be expected to pay after the deadline?
Stamp duty can add £10,000s to a homebuyer's costs; the rate of stamp duty you'll pay depends on where in the UK you're buying a property.
It is expected that the stamp duty tax amount will revert to the rates of stamp duty land tax (SDLT) that were in place before July 2020.
You can work out exactly how much you would pay using a stamp duty calculator.
If you are thinking of purchasing a property at the moment and want some more advice and information on all your options, get in touch with a member of the team today.