With Watson Burton LLP Law Firm
On 2 September 2008, The Treasury announced that there would be an exemption to Stamp Duty Land Tax (SDLT) for land transactions involving purely residential property where the value is up to £175,000.
The relief will apply to any acquisition of a major interest in land for SDLT purposes, which in England and Wales applies to:-
The new measures will apply to eligible transactions made between 02 September 2008 and 03 September 2009. Prior to this exemption, SDLT at a rate of 1% was payable on the price of residential properties valued between £125,000 and £250,000. For one year, the 1% SDLT rate will apply to properties valued between £175,000 and £250,000.
The raised threshold is therefore intended to benefit first time homebuyers in particular, as the average UK residential property is currently £164,000. However, property buyers in Greater London and the South of England will benefit less than in other regions, as their average property prices greatly exceed the £175,000 threshold.
Purchasers of properties worth more than £250,000 will continue to pay 3% in SDLT, while transactions of properties of more than £500,000 will still attract SDLT at the rate of 4%.
If you have any comments or questions about this article or any property related matters, please contact Mark Lennon of Watson Burton LLP at mark.lennon@wastonburton.com.
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