Image for article: Stamp Duty Holiday Extension to 31 March 2021

Stamp Duty Holiday Extension to 31 March 2021

21 September 2020
Butler Sherborn logomark

Keep up to date with the latest properties, rural business insights, market commentary and events:

Join mailing list

The chancellor's policy of the suspension of Stamp Duty, on the first £500,000 of all property sales in England and Northern Ireland, has helped boost house prices. August saw the highest monthly price rise in more than 16 years, according to the Nationwide. It describes the housing market recovery as "unexpectedly rapid".

What is stamp duty?

Stamp duty is a tax paid by people buying properties, although it varies slightly across the UK.

In England and Northern Ireland buyers pay Stamp Duty Land Tax.

In Scotland it is Land and Buildings Transaction Tax, while in Wales buyers pay Land Transaction Tax.

The amount handed to the government depends on where you are in the UK, and the price of the property.

The changes to stamp duty only apply to buyers in England and Northern Ireland.

What has changed?

The government has temporarily increased the stamp duty threshold to £500,000 for property sales in England and Northern Ireland, until 31 March 2021,

Anyone completing on a main residence costing up to £500,000 before then will not pay any stamp duty, and more expensive properties will only be taxed on their value above that amount.

This will save buyers as much as £15,000, if they are buying a property of £500,000 or more.

The move was aimed at helping buyers who have taken a financial hit because of the coronavirus crisis.

It was also intended to boost a property market hit by lockdown, which had seen  house prices fall for four months in a row.

The average stamp duty bill will drop by £4,500, Mr Sunak has suggested, with nearly nine out of 10 people buying a main home this year paying no stamp duty at all.

How much stamp duty will I pay now?

If the property purchased is your main home, you won't pay any stamp duty on it at all if it costs £500,000 or less.

The next portion of the property's price (£500,001 to £925,000) will be taxed at 5%, and the £575,000 after that (£925,001 to £1.5m) at 10%.

The remaining amount (over £1.5 million) will be taxed at 12%.

Before the announcement, stamp duty in England and Northern Ireland was paid on land or property sold for £125,000 or more, while first-time buyers did not pay any stamp duty up to £300,000. But this stamp duty holiday replaces the first-time buyer discount.

Landlords and second home buyers are also eligible for the tax cut but will still have to pay the extra 3% of stamp duty they were charged under the previous rules.

How much does stamp duty raise?

The government's annual take from stamp duty is around £12bn, according to the latest figures released by HM Revenue and Customs (HMRC).

That's roughly equivalent to 2% of the Treasury's total tax take.

The nine-month stamp duty holiday in England and Northern Ireland - from July 2020 to March 2021 - will cost the Treasury an estimated £3.8bn.

News & Comment
Read Article
Studio Chappell

Meet Charlotte, Founder of Studio Chappell – Our Official Interior Design Partner

We’re delighted to offer a complimentary one-hour design consultation with Charlotte Chappell, Studio Chappell, our official interior design partner. Whether you're planning a full renovation or simply looking to refresh a single room or kitchen, Charlotte can provide her expert guidance tailored to your needs. We sit down with Charlotte in our Cirencester office over a cup of tea to find out more!

Meet Charlotte, Founder of Studio Chappell – Our Official Interior Design Partner
Read Article
Easter House

Why Local Expertise Still Matters in the Digital Property Market

In an age when almost every property search begins online, it’s tempting to think that technology has replaced the need for local expertise. After all, digital platforms can showcase homes in seconds to a national and international audience, complete with glossy imagery, virtual tours, and videos, and instant alerts. Yet, in practice, it has never been more important to have a trusted local expert guiding you through the process.

Why Local Expertise Still Matters in the Digital Property Market
Read Article
Renters Right

Renters Rights Bill - Update

The House of Lords have now completed their scrutiny of the Renter’s Rights Bill and yesterday The House of Commons finished their final stage of reviewing the Bill, before now going for Royal Assent.

Renters Rights Bill - Update
Read Article
The Rectory

October Market Comment - Hear from Elizabeth D'Allemagne, Senior Partner

While speculation continues to divide the market between those eager to exchange pre-Budget and those waiting for clarity, some properties are still moving at remarkable speed. We take a closer look below.

October Market Comment
A laptop on a desk with houseplants an coffee
Instant Digital Valuation

Wondering what your property is worth?

Get an estimated valuation for you property using our free digital valuation tool.

Rightmove logo
Rics logo
The Property Ombudsmen logo
CTSI Approved Code logo
CAAV logo
The London Office logo
Team Way Eventing logo