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Rushing to beat the Stamp Duty deadline?

8 Feb 2016
Rushing to beat the Stamp Duty deadline?

The new Stamp Duty rates for second homes are due to come to force on 1st April 2016, as a result, some buy-to-let investors are keen to invest before the changes come into effect. In fact, Rightmove has reported its busiest month ever for traffic.

The figures at a glance…

There will be an additional charge of 3% applied on top of the current stamp duty land tax rates:

  • 3% tax to pay on homes worth up to £125,000
  • 5% tax on homes that cost between £125,001 and £250,000
  • 8% on homes worth between £250,001 and £925,000
  • 13% on homes worth up to £1.5 million
  • 15% charge on properties priced above £1.5 million

A few things to note:

  • If you exchanged contracts before the Autumn Statement on November 25th 2015, the higher tax rate won’t apply, even if completion is after the 1st April.
  • As a parent, you can still be a guarantor for a loan, but a joint mortgage that requires your a parent’s name on the title deed will be hit by the tax.
  • Couples who want to buy a property each will be taxed, married couples and civil partners will be treated as a single unit and any additional property purchased by either person will attract the higher rates.
  • Do not rush into anything. If you are looking to avoid the new taxes, make sure that the 3% saving is not outweighed by temporary rises to property prices as a result of the rush.

For more details, please contact us on 020 8740 6622.