The Chancellors Mini Budget – Stamp Duty Update

The Chancellors Mini Budget – Stamp Duty Update

Since Rishi Sunak hinted that stamp Duty Land Tax (‘SDLT’) was going to be updated the property market has been holding its breath. Happily, we can all now breathe out because firm details have emerged:

• The chancellor announces he will cut stamp duty to reinvigorate the housing market.
• The threshold for stamp duty will increase from £125,000 to £500,000. The cut will be temporary, running until 31 March 2021, and will take effect immediately.

This is a very helpful headline and, for some, will answer all the questions and assist transactions looking to move forward.  However, what is unclear is if this threshold increase will potentially extend to commercial properties? What happens to the higher rate payable on second properties? Will that threshold change/ be affected?

While the increase in the threshold is certainly welcome, realistically, this won’t assist everyone in the region.  First time buyers are already exempt from SDLT and with the average house price in East Anglia being £341,072 it won’t take too may extra bells and whistles for house transactions to exceed the £500,00 threshold. 

Despite this analysis any tax break is certainly welcome at this time and it will be interesting to see how houses will be priced in view of this favourable SDLT bracket and whether people will be selling for less in order to allow buyers to use this tax break.

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