Time to look at Stamp Duty - and the savings still available

Posted 13/07/2021 by Reeds Rains
Clock timer

The stamp duty holiday has helped many save money when buying property and even now, despite the initial holiday ending, there remains some potential stamp duty savings to be had. Reeds Rains provides further information about these.

 

What is the stamp duty holiday?

The holiday, announced last July, aimed to stimulate the property market following the first Covid-19 lockdown and led to no stamp duty being payable on properties under the value of £500,000.This was originally due to run until 31 March 2021 and was then extended until 30 June 2021.

 

Are there still stamp duty savings available?

Yes.

  • From 1 July 2021 – until 30 September, there’s still no stamp duty payable on properties under the value of £250,000 – but there has been an introduction of a 5% rate for values between £250,001 and £500,000.
  • From 1 October – the stamp duty will begin to apply for all properties valued £125,000 and above – with different percentages applying to different price brackets within the purchase price

 

What are the stamp duty price brackets – pre and post October 2021?

From 1 July 2021 to 30th September 2021, the following stamp duty rates apply - within the purchase price

  • £0 to 125,000 = 0%
  • £125,001 to 250,000 = 0%
  • £250,001 to 500,000 = 5%
  • £500,001 to 925,000 = 5%
  • £925,001 to 1,500,000 = 10%
  • £1,500,001 plus = 12%

From 1 October 2021 stamp duty will be applied at the following rates, within the purchase price

  • £0 to 125,000 = 0%
  • £125,001 to 250,000 = 2%
  • £250,001 to 500,000 = 5%
  • £500,001 to 925,000 = 5%
  • £925,001 to 1,500,000 = 10%
  • £1,500,001 plus = 12%

 

Can I still benefit from the stamp duty holiday?

It depends on the value of your property but, if it’s worth less than £250,000 and you can complete your purchase by 1 October 2021, you can definitely take advantage of the current stamp duty holiday – and there may be saving opportunities for those buying for higher amounts too – again if you can complete your purchase in time. Here’s an example:

Buying a property worth £400,000 BEFORE 1 OCTOBER means you’d pay stamp duty of £7,500

Up to £125,000 x 0% = £0

125,001 to £250,000 = 125,000 x 0% = £0

£250,001 to £400,000 = £15,000 x 5% = £7,500

TOTAL £7,500

Buying the same property AFTER 1 October means you’ll pay stamp duty of £10,000

Up to £125,000 x 0% = £0

£125,001 to 200,000 = 125,000 x 2% = £2,500

£250,001 to £400,000 = £15,000 x 5% = £7,500

TOTAL £10,000

You may also like to use the Reeds Rains Stamp Duty calculator, to find out how much you could save and find out what rates might apply if buying in Scotland or Wales.

 

What should I do if I want to take advantage of the stamp duty holiday now?

Act quickly. It’s worth starting your search for a property and, if you are an existing homeowner, place your property on the market as soon as possible. Time is definitely of the essence and could be running out but, whatever you decide, your local Reeds Rains team will be there to assist you in any way they can and help you discover if now’s the time to make your next move.

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