Chancellor’s stamp duty restructure in this year’s Autumn Statement

Chancellor’s stamp duty restructure in this year’s Autumn Statement

From 4 December, stamp duty land tax (SDLT) on residential property has been changed from the ‘slab’ approach – where an extra £1 of purchase price could add £40,000 to the tax bill – to a tiered, income tax style of approach, with each of five slices of value attracting a different rate (see below). The end result is that 98% of home-buyers will pay less or the same amount in SDLT, while 2% – those buying properties valued at over £937,500 – will pay more.

Band of Residential Property Value (£) SDLT Rate (%)
Up to 125,000 0
125,001-250,000 2
250,001-925,000 5
925,001-1,500,000 10
1,500,001 & over 12

 

Example:

A property valued at £650,000 would be subject to stamp duty land tax of:

£0-£125,000 @ 0% £0
£125,000-£250,000 @ 2% £2,500
£250,000-£650,000 @ 5% £20,000
Total £22,500

Under the old slab SDLT regime, a flat rate of 4% would have applied to the whole value, giving a tax bill of £26,000.

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