An assortment of changes to stamp duty rules have made it one of Britain’s most complicated taxes. New rules which mean no one buying a property worth less than £500,000 pays the transaction tax is boon to buyers but also add another layer of complexity.
The rates were first overhauled in 2014 – moving it from a “slab” to a “tiered” system. So instead of one rate being applied to the entire purchase value, a number of rates were applied at successive thresholds.
This had the effect of increasing the duty paid on more valuable properties, and reducing it for those toward the bottom.
The next significant change came in April 2016.
This saw the introduction of a three percentage point surcharge on additional home purchases. This was aimed at cooling the buy-to-let market by applying higher rates of tax to those buying investment properties or holiday homes.
The “additional” rate of stamp duty does not apply where the investment property is being bought via a company structure.
Changes introduced today by the Chancellor Rishi Sunak mean buyers whose property is worth less than £500,000 will pay no stamp duty. Where properties are more expensive, the first £500,000 will be free of tax. This will last until March 31 2020 when the “holiday” ends.
Use this calculator to work out how these changes affect how much you’ll pay. Click the tick-box at the top, right if you are a first-time buyer as they have additional exemptions from paying the tax.