Following the recent budget announcements there are changes to Stamp Duty Land Tax for 2012 and beyond
As expected the first time buyers relief for purchases up to £250,000 has been withdrawn. All other rates and bands remain the same for both residential and non- residential property. However, a new rate and band has been introduced at 7% for residential properties over £2 Million pounds. There has also been a tightening of Stamp Duty avoidance for such properties (see note (2) below)
| Rate | Residential Property (1) | Non Residential |
| 0% | £0 – £125,000 | £0 – £150,000 |
| 1% | £125,001 – £250,000 | £150,001 – £250,000 |
| 3% | £250,001 – £500,000 | £250,001 – £500,000 |
| 4% | £500,001 – £1,000,000 | £500,001 + |
| 5% | £1,000,001 – £2,000,000 | |
| 7% | £2,000,001 + (2) |
Notes:
(1) From Mid July 2011 onwards, bulk purchases of residential property will only be subject to Stamp Duty Land Tax at the average value of each property rather than the total value of all the properties being purchased in bulk. See example here.
(2) Residential properties over £2,000,000 and purchased by “non natural persons” i.e. a limited company, will be subject to 15% stamp duty from 22 Mar 2012. This closes the previous ‘loophole’ where property could be transferred into a limited company therefore becoming a company asset. The property could then be purchased by buying the companies shares which only attracted 0.5% stamp duty rather than 5% (2011). This article gives interesting insight into how these changes might affect the buoyant Central London housing Market.
HMRC Rates and Allowances 2012
