Are we better or worse off? That is the question prospective homebuyers are asking George Osborne as he announced his Autumn Statement 2014 changes to the payment of stamp duty land tax on residential property purchases. The changes take effect immediately. However, if you have exchanged contracts but are yet to complete, you have the choice of the new or old regime. Commenting, Helen Rowe, residential property lawyer at stevensdrake, said: “Many will see this new formula as being fairer - the fundamental change is that the payment of tax is graduated; rather than one percentage tax on the whole amount of the purchase price (slab) the buyer pays differing percentages on differing chunks of the purchase price (slice).” The minimum threshold has not changed but the percentage tax payable has changed with the band values also changing. There is still no stamp duty payable until the consideration payable exceeds £125,000. The new rates are 0% on the value of a property 0-£125,000, 2% on £125,001 - £250,000, 5% on £250,001 - £925,000, 10% on £925,001 - £1,500,000 and 12% on the remaining value over £1,500,000.
For example therefore on a purchase of a property for £450,000 the SDLT = £12,500.This is 0% on 1st £125,000, 2% on £125,000 and 5% on £200,000.
The old regime would have been 4% on £450,000 = £13,500