Stamp Duty Changes 2022

Kwasi Kwarteng may not have been the Chancellor for very long, but he did make some important changes to Stamp Duty Land Tax (SDLT).

These changes came into effect on September 23 2022. Unfortunately, the changes are not retrospective and so anyone buying before this date had to pay the full amount.

Stamp Duty Land Tax (SDLT) is the tax that you have to pay to the Revenue and Customs (HMRC) residential property purchases in the UK. How much you pay, depends on how much you pay for the property and SDLT is paid on leasehold as well as freehold properties.

Probably the biggest change is that Stamp Duty now starts at £250,000 properties, instead of £125,000. This helps anyone buying a property to reduce or eliminate their tax bill.

First time buyers won’t have to pay Stamp Duty at all if property costs less than £425,000. This is aimed at keeping the property market going, however, with interest rates also rising, the expected effect may not materialise.

So the new rates for SDLT are:

• 0%: £0 – £250,000 ( or up to £425,000 for first-time buyers)
• 5%: £250,000 – £925,000
• 10%: £925,000 – £1,500,000
• 12%: £1,500,000+

With the cost of living crisis having a potential negative effect it remains to be seen what will happen to the Thames Valley market. One aspect of the local market is that there has been a number of people moving out of London, seeking more spacious properties, particularly in West Berkshire and villages around Reading. Remote work, access to transport links, good schools and beautiful countryside has attracted many to relocate.

Conveyancing Solicitors will probably see a little boost in the numbers of home purchasers and sellers over the next couple of months. No one can really predict the Government’s future actions in the short term and people are choosing to take advantage of this tax saving now because it is not really clear if this is going to be a permanent change.

Moving home can be a very stressful event, because it is not always simple. There are many factors that can create problems, particularly if there is a housing chain. Land registry delays, banks changing mortgage products, other solicitors, surveyors - with a chain there may be several factors at play. Being diligent, thorough and aware of any likely problems with a sale or purchase is the role of the conveyancing solicitor.

At Hewetts, we are experienced at solving problems and helping the momentum of a transaction continue, whilst providing solid legal work that highlights and solves any potential problems.

If you would like a conveyancing quote please do get in touch with Debbie Sumitra and if you are planning to buy or sell, or both, during the next few months, we would love to hear from you to see how we can help.

Published on 01/11/2022