Mini-Budget: changes to Stamp Duty explained

by | Sep 23, 2022 | Blog Posts

stamp duty land tax

On 23 September 2022 the Chancellor, Kwasi Kwarteng, announced in his first mini-budget that the Stamp Duty Land Tax (SDLT) thresholds for residential properties in England and Northern Ireland would be increased with immediate effect.

| SDLT threshold

The “nil rate band” has been increased from £125,000 to £250,000. This means that SDLT does not need to be paid on the first £250,000 of the purchase price of any residential property*.

| Stamp duty relief for first time buyers

There was even more good news for first time buyers in the mini-budget. From 23 September 2022, if a buyer qualifies as a first time buyer, the “First Time Buyer SDLT nil rate band” has been increased from £300,000 to £425,000. This means that SDLT does not need to be paid on the first £425,000 of the purchase price of any residential property being purchased by a qualifying first time buyer*.

In addition, First Time Buyer’s Relief was previously only available on properties being purchased at a price of up to a maximum of £500,000. This upper limit has now been increased to £625,000.

| What this means for your purchase

As from 23 September 2022, by applying these new thresholds property buyers could save up to £2,500 in SDLT and first time buyers could save up to £11,250 in SDLT.

Unlike the previous “SDLT holiday” these threshold changes are permanent and are not subject to a deadline.

 

*Second Home SDLT surcharges and Non-Resident SDLT surcharges still apply to the whole purchase price if buyers are caught by these surcharges.

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