Stamp Duty Holiday & How it Will Work

Chancellor Rishi Sunak yesterday announced a stamp duty land tax (SDLT) holiday which will run between 8 July 2020 and 31 March 2021 inclusive, in a bid to boost the housing market.

What has Changed?

If you purchase a residential property between 8 July 2020 and 31 March 2021, you only start to pay SDLT on the amount you pay for the property above £500,000. These rates apply whether you are buying your first home or have owned property before.

You can use the table below to work out the SDLT due:

Property, lease premium or transfer value

SDLT rate

Up to £500,000

Zero

The next £425,000 (the portion from £500,001 to £925,000)

5%

The next £575,000 (the portion from £925,001 to £1.5 million)

10%

The remaining amount (the portion above £1.5 million)

12%

From 8 July 2020 to 31 March 2021 the special rules for first time buyers are replaced by the reduced rates set out above.

How Much Could you Save on Stamp Duty?

With wide variations in house prices, the average savings that home buyers in England can typically expect to make from the stamp duty holiday vary from hundreds of pounds to as much as £15,000, according to calculations from Rightmove.

The website analysed average asking prices across the country in June to calculate the average saving a buyer might expect to make from the stamp duty “nil rate” band being raised temporarily to £500,000.

Here are Rightmove’s estimates for the amounts that buyers could typically save, depending on where they live:

  • North East, £646
  • Yorkshire and the Humber, £1,550
  • North West, £1,638
  • East Midlands, £2,222
  • West Midlands, £2,262
  • South West, £6,100
  • East of England, £8,153
  • South East, £10,980
  • London, £15,000