Stamp Duty Land Tax: Temporary reduced rates
July 18, 2020
On Wednesday, 8th July 2020, Chancellor Rishi Sunak announced a reduction in stamp duty rates in a bid to stimulate the housing market.
If you purchase a residential property between 8th July 2020 to 31st March 2021, you will only start paying stamp duty on the amount that you pay for the property above £500,000. The rates of stamp duty land tax can be found in the table below:
| Property or lease premium or transfer value | SDLT rate |
|---|---|
| Up to £500,000 | Zero |
| The next £425,000 (the portion from £500,001 to £925,000) | 5% |
| The next £575,000 (the portion from £925,001 to £1.5 million) | 10% |
| The remaining amount (the portion above £1.5 million) | 12% |
The rates for first time buyers have been replaced by the reduced rates above.
Higher Rates for additional properties
Limited Companies and Individuals buying their second property must pay the 3% higher rate for any residential property they buy if:
- the property is £40,000 or more
- there is no lease on the property in place with more than 21 years
The following rates now apply:
| Property or lease premium or transfer value | SDLT rate |
|---|---|
| Up to £500,000 | 3% |
| The next £425,000 (the portion from £500,001 to £925,000) | 8% |
| The next £575,000 (the portion from £925,001 to £1.5 million) | 13% |
| The remaining amount (the portion above £1.5 million) | 15% |
On the 1st April 2021, the stamp duty rates will revert back to the rates of SDLT in place prior to 8th July 2020.
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