News
Stamp duty threshold to be raised after Budget report
24 March 2010
The Chancellor Alistair Darling has announced that the starting threshold for Stamp Duty will now be raised from £125,000 to £250,000 for first-time buyers.
Coming into effect at midnight on Wednesday 24th March the reform will be applicable for the next two years.
Darling believes that this will help nine of out ten first-time buyers looking to move within this period and to help reclaim some of this money the levy for properties over £1million will be charged at 1%.
On December 31st 2009 there were a rush of transactions to beat the end of the stamp duty holiday, which has raised the starting threshold for stamp duty from £125,000 to £175,000. There had been calls to extend this holiday to help sustain the housing market recovery and to reform the current system which charged stamp duty as a percentage of the total purchase price depending on the value of the property.
The Council of Mortgage Lenders (CML) had calculated that 92% of first-time buyers would have been exempt from stamp duty had the starting threshold been at £250,000 last year. The £175,000 threshold in place last year allowed 73% of first-time buyers to avoid paying the tax.
Source: Mortgage Strategy
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