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2nd Property Stamp Duty Covid-19 Stamp Duty Questions

Does the Stamp Duty Cut Apply to Second Properties?

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stamp duty cut apply to second properties?Last week, the Chancellor Rishi Sunak announced a cut in stamp duty to 0% for the first £500,000 of the property purchase price in order to kick start the housing market. But does this stamp duty cut apply to second properties?

The answer to this question is yes and no. The way that stamp duty is calculated on a second property is that you basically pay an additional 3% of the purchase price on top of the standard stamp duty that is payable on a residential property (assuming that the property you are purchasing costs more than £40,000). Continue reading

2nd Property Stamp Duty Budget First Time Buyers Stamp Duty Changes

2018 Budget Stamp Duty Changes

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Philip Hammond delivering his 2018 Budget speech.

The Chancellor of the Exchequer, Philip Hammond, delivered his 2018 Budget yesterday (29th October) and introduced a couple of changes to Stamp Duty within that budget. One change was announced in the House of Commons during his budget speech and the other change was in the small print of the published budget documentation and so we will detail both here.

First Time Buyers

The first change was a major one and was building on the change announced in the last budget which gave first time buyers relief on paying stamp duty on certain purchases. Following this change, the Chancellor announced, 121,500 first time buyers had benefited from the change and the number of first time buyers has hit an 11 year high.

The addition to last years announcement is that first time buyers are now exempt from stamp duty when they purchase shared ownership properties up to the value of £500,000.

This change is also extended to property purchases within this remit that occurred since the last budget, so people who may already have bought properties that meet the criteria should be able to reclaim the stamp duty that they have paid.

Time Limits Extended

The other change was a minor amendment to extend the time limits for when additional stamp duty can be reclaimed after the sale of an old property.

The background on this is that previously, if you sold your main home within 3 years of buying a new one (main residence) then you could reclaim the extra 3% stamp duty paid. But you needed to claim this extra stamp duty within 3 months of selling the old home (or 12 months of buying the new one if that was later). This has now changed and you have 12 months after selling the old property to reclaim the extra stamp duty, giving a bit more breathing space for reclaiming the money.

You can find out further information on that change here.

Note: Apologies that this article was previously titled 2019 Budget Stamp Duty Changes and it has now been amended.

 

2nd Property Stamp Duty

Second Home Stamp Duty Calculator

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Second home stamp duty calculatorIf you want to work out the amount of stamp duty payable on a second property purchase where you already own a property and the higher rates are due, then you can work this out below.

The Chancellor of the Exchequer introduced and additional 3% stamp duty charge for those people who are buying a second (or subsequent) home to raise money to help with more house  building for the country. This did make it quite confusing to work out the amount of stamp duty payable.

The aim of the increased amount of stamp duty was to slightly discourage buy to let purchasers so that more properties were available for first time buyers, who tended to be competition for the same types of properties.

The rules about whether you need to pay the extra stamp duty can be quite confusing particularly if you have some very individual circumstances so you really need to consult your solicitor if you are not sure if you are liable to pay the extra amount or not. In general, if you already own a property, whether in the UK or abroad, then you are liable to pay the extra amount on any subsequent property purchase.

Use the second home stamp duty calculator below to work out how much is due according to the purchase price of the property. Enter the amount of the purchase price and you will see how much you need to pay in stamp duty.

You can also check out our stamp duty calculator page to see what the stamp duty would be on your main residence where the additional amount is not due.

It can make a huge difference in the amount of stamp duty payable, particularly on higher value properties, depending on whether it is classed as a main residence purchase (or replacement) or a second home purchase.

You can also check out the archive on news articles that are relevant to a second property purchase.

2nd Property Stamp Duty Stamp Duty Questions

Do I Pay Extra Stamp Duty When Replacing My Main Residence?

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Since the new rules on the amount of Stamp Duty that you have to pay were introduced in April 2016 there have been many questions about whether or not you need to pay the extra Stamp Duty of 3% when buying property if you (and that means one of you if you are buying as a couple) already own another property.

One common question is ‘do I have to pay the extra stamp duty if I am replacing my main residence?‘ Continue reading

2nd Property Stamp Duty Stamp Duty Questions

Does the Extra Stamp Duty Apply to Non-Residential Property?

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In April 2016 the government introduced the extra 3% stamp duty for purchases of second and further properties in the UK. This was to discourage the recent buy to let phenomenon which has meant that a lot of first time buyers are struggling to get on the property ladder.

However, there are a lot of conditions on the way the extra 3% rate is being applied and in the final Guidance Note issued by the government there was clarification on what type of purchase the charge applied to. Continue reading

2nd Property Stamp Duty

Will I Have to Pay Extra Stamp Duty if I Have Already Sold My Main Residence?

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There is a lot of confusion about the new stamp duty that generally applies to purchases of second homes. One particular area of confusion lies where a person has already sold their main residence and is about to buy another one. The confusion lies where the person in question also owns other properties (or even just one other property).

So for example you may have sold your main residence in 2014 and have been renting for whatever reason in the interim before buying another property to live in. But let’s say that already own 2 rental properties as well. Will you have to pay the extra stamp duty if you already own property but have sold your main residence? Continue reading

2nd Property Stamp Duty

Extra Stamp Duty Nearly Here

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So at the end of this week the new stamp duty charge will be introduced of 3% on top of standard levels if you are buying a second property.

Although the changes went through a consultation period not many changes came out of this apart from the maybe unexpected change of extending the crossover period (giving you time to dispose of an old property while still being able to reclaim the extra stamp duty) from 18 to 36 months.

One other change was to include landlords with bigger portfolios of properties in the changes as well.

Some conveyancers have been working over the Easter weekend reportedly but others have not done so and in fact some vendors/buyers have said that no extra effort appears to be being made by their solicitors to get things done before the cut off date of 31 March 2016.

So it seems likely that some people may be caught up unexpectedly in the trap of the extra stamp duty and may have to stump up the extra cash. Obviously those on a tight timescale will be checking in regularly with their solicitor.

However, if purchasing the property for the long term some buyers may be philosophical if there is not much likelihood of the transaction going through before the 1 April deadline.