Autumn Budget 2017: Stamp Duty Scrapped For Most First-Time-Buyers
At the heart of the Chancellors Autumn budget was the housing crisis and helping first-time-buyers move onto the property ladder. Most First time buyers will now pay zero stamp duty on the first £300,000 of any home that costs up to £500,000 with immediate effect – a cut of up to £5,000.
The move came as he promised a wide-ranging package to boost housebuilding, setting a target of an annual 300,000 homes built by the middle of the next decade. The changes apply to purchases by first-time buyers in England, Wales and Northern Ireland.
What is stamp duty?
Stamp Duty is the tax that is paid on a residential property, or a piece of land in England, Ireland and Wales. In Scotland, you will pay a Land and Buildings Transaction Tax instead of Stamp Duty. This tax applies to both freehold and leasehold properties – whether you’re buying outright or with a mortgage.
How will the new system affect first-time buyers?
The new stamp duty rates for first-time-buyers in England, Ireland and Wales buying their first property costing up to £500,00 are;
- Property purchase price up to £300,000: 0% stamp duty
- Property purchase price between £300,000.01 to £500,000: 5% (on the portion of the purchase price only)
If you purchase your first property costing more than £500,000 you will not benefit from any change and will pay the standard stamp duty rate. Click here to calculate stamp duty for properties bought for more than £500,000.
Who Is A First-Time-Buyer?
A first-time-buyer is anyone who has never owned a property within any country whether bought or inherited, and can now benefit from the new stamp duty tax scheme.
How Much Will First-Time-Buyers Save?
The amount that first-time-buyers will save is dependant on the region you live in. In London, where the average first-time buyer house price is £422,380 the savings from a stamp duty exemption would average £11,119. For other regions of the country, the average saving could be up to £3,000.
When Does The Stamp Duty Change Come Into Effect?
As of 22 November 2017 – 00.01am the new stamp duty scheme can into effect.
If you are currently in the processes of buying your first home and the purchase hasn’t completed yet you will benefit from the new stamp duty tax scheme.
Do I Pay Stamp Duty If It Is A Buy-To-Let Purchase, And Im A First-Time-Buyer?
If the property being purchased is used for anything other than your main residence then the standard stamp duty rate will apply.
What to expect when first meeting with your mortgage broker.