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If you have any questions relating to this article, or to speak to our Development and House Building Team, please contact William Nassau-Lake on [email protected]
On 8 July 2020 the Chancellor the Exchequer announced a reduction to the rates of SDLT which apply to the purchase or residential property in England.
Following the introduction of the new rates, a purchaser which completes a purchase of residential property in England between 8 July 2020 and 31 March 2021 will only pay SDLT on consideration above £500,000.
Property or lease premium or transfer value |
SDLT rate |
---|---|
Up to £500,000 Zero |
0% |
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% |
Please use this LINK to access the HMRC SDLT calculator
The new rates mean that for purchaser of residential property for a price of £500,000 or above will save £15,000. Purchasers of properties for less than £500,000 will benefit proportionally as can be seen from the table below.
Price |
SDLT Liability Rates - Pre 8 July Rates |
SDLT Liability |
Saving |
---|---|---|---|
£500,000 |
£15,000 | £0 |
£15,000 |
£400,000 |
£13,750 | £0 |
£13,750 |
£300,000 |
£8,750 | £0 |
£8,750 |
£200,000 |
£3,750 | £0 |
£3,750 |
These new rates apply to both first time purchasers and purchasers that have owned homes before.
From 8 July 2020 to 31 March 2021 the rules that had previously applied to first time purchasers are replaced by the new reduced rates set out above.
Purchasers of second homes and companies/LLPs purchasing residential property in England prior to the end of March 2021 will also benefit from the reduced rates albeit the existing 3% higher rate pf SDLT will continue to apply on top of revised standard rates referred to above until 31 March 2021.
Companies/LLPs seeking to benefit from the reduced rates (such as property developers and property rental business) must first meet the conditions for relief from the 15% rate of SDLT.
Boyes Turner’s Development and House Building Team advise a wide range of commercial and residential developers, land traders, promoters, funders and land owners across England and Wales.
Consistent with our policy when giving comment and advice on a non-specific basis, we cannot assume legal responsibility for the accuracy of any particular statement. In the case of specific problems we recommend that professional advice be sought.
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If you have any questions relating to this article, or to speak to our Development and House Building Team, please contact William Nassau-Lake on [email protected]
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