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Stamp Duty Holiday Extension Explained

Stamp Duty Holiday Extension Explained

The Chancellor announced the extension of the Stamp Duty Holiday in his Budget speech yesterday (March, 3). Originally planned to end in March, the revised dates are as follows:

  • The current £500,000 nil-rate band in England will apply until 30 June
  • Between 1 July and 30 September, it will be reduced to £250,000
  • from 1 October, the previous threshold of £125,000 will be reinstated

What does this mean in practise?

This means that people buying before 1 June will save up to £15,000, while those buying between 1 July and 30 September will save up to £2,500 in tax.

The extension will provide those who have already agreed sales to complete their purchase and benefit from the Stamp Duty Holiday.

The Stamp Duty Holiday was introduced to encourage people to move home after the first lockdown last year, and it has undoubtedly resulted in greater demand for property.

HMRC figures show that 129,400 transactions were completed in the UK in December, compared to 87,040 in December 2019 and 83,880 in December 2018.

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The Chancellor also announced that the UK’s biggest lenders will be offering 95% mortgages guaranteed by the government from next month to help buyers with small deposits get on or up the housing ladder.

Simon Cooper, Partner of Stags, commented;

“It is most helpful to existing buyers that this extension to the deadline has been announced enabling them to save the tax, as solicitors were struggling to get these deals through by the end of this month. This will undoubtedly mean that there will be a greater influx of buyers looking to acquire a West County property in the next few months so if you are thinking of moving in 2021, don’t delay in contacting us, even for an informal discussion”