IT WILL COST MORE TO BUY A HOUSE FROM 1ST APRIL 2025
Significant changes to Stamp Duty Land Tax (SDLT) in England are scheduled to take effect on 1st April 2025. These adjustments will impact all residential property buyers, with notable effects on first-time purchasers. Here's an overview to help you navigate the upcoming changes.
Current SDLT Structure (Until 31st March 2025)
Standard Residential Purchases:
No SDLT on the first £250,000.
5% on the portion between £250,001 and £925,000.
10% on the portion between £925,001 and £1.5 million.
12% on amounts over £1.5 million.
First-Time Buyer Relief:
No SDLT on properties up to £425,000.
5% on the portion between £425,001 and £625,000.
No relief for properties over £625,000.
Upcoming Changes Effective 1st April 2025
Reduction of the Nil-Rate Band:
The tax-free threshold will decrease from £250,000 to £125,000.
A 2% rate will apply to the portion between £125,001 and £250,000.
Subsequent rates remain unchanged.
Adjustments to First-Time Buyer Relief:
The nil-rate threshold will drop from £425,000 to £300,000.
5% SDLT on the portion between £300,001 and £500,000.
No relief for properties over £500,000.
Implications for Buyers
First-Time Buyers:
Purchasing a property between £300,001 and £425,000 will now incur SDLT, increasing buying costs.
For example, a first-time buyer acquiring a £400,000 home will face an SDLT bill of £5,000 from April 2025.
All Homebuyers:
With the nil-rate band halved, properties priced over £125,000 will attract higher SDLT.
A property purchased for £300,000 will incur an additional £2,500 in SDLT after the changes.
Strategic Considerations
Timing Your Purchase:
Completing transactions before 1st April 2025 allows buyers to benefit from current SDLT rates and reliefs.
Given that property transactions can take several weeks, initiating the process promptly is advisable.
Financial Planning:
Incorporate the impending SDLT changes into your budget to avoid unexpected expenses.
The Government’s SDLT Calculator can help estimate potential liabilities accurately.
Seek Professional Advice:
Talk to Rands Solicitors to understand the full impact of these changes on your specific circumstances and to obtain a no obligation quotation
In summary, the forthcoming SDLT adjustments will influence property purchasing costs across various price ranges. Early awareness and proactive planning are essential to navigate these changes effectively and make informed decisions in the evolving property market.
Call us on 01724 786272 during office hours for a no obligation chat or contact our experts for further information;
Robert Taylor: robert@randssolicitors.co.uk Telephone 01724 786272
Megan Taylor: megantaylor@randssolicitors.co.uk Telephone 01724 786272
Danielle Johnson: danielle@randssolicitors.co.uk Telephone 01724 786272
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