Save Money with the Stamp Duty Holiday
There aren’t many industries that haven’t been affected by the COVID-19 pandemic. The property sector is one that’s been hit particularly hard. According to figures from the Evening Standard, 50,000 fewer people bought a new home in the first half of 2020 compared to the previous year.
As we move into the summer months, now might just be the optimal time to consider a move. This is because there is still time to avoid stamp duty on any move away. Last July, Chancellor Rishi Sunak announced the stamp duty holiday which can save buyers up to £15,000. Originally due to end on 31st March, earlier this year the deadline was extended until 30th June.
What is Stamp Duty?
Stamp Duty, or Stamp Duty Reserve Tax (SDTR), is a tax that most people buying a property will be faced with. Stamp duty is always paid by the buyer, and how much is paid is determined by a number of factors including the location of the property and how much you’re paying for it.
There have been many stamp duty reforms over the years, including in July last year when the Chancellor announced a stamp duty holiday. This means that since July 2020 and until 30th June 2021, buyers will not be required to pay any stamp duty.
And it has clearly worked. Since the stamp duty holiday was announced, there have been 140,000 additional sales, according to a report from Zoopla, demonstrating the effectiveness of the scheme.
Will there be an extension on the stamp duty holiday?
Prior to the original March deadline, the government had indicated there would be no extension to the stamp duty holiday. But, after mounting pressure from those in the industry, including a letter from the Guild of Property Professionals, the decision was made to extend it until the end of June.
This means that the stamp duty holiday will now finish in line with the UK leaving lockdown at the end of June, so it’s unlikely the government will consider extending it further.
What do I need to do?
If you’re a homebuyer or buy-to-let investor, you need to act fast to make the most of the stamp duty holiday.
Any purchase completed before the deadline will avoid having to pay stamp duty. The best way to swiftly complete the process is to purchase a property outside of a chain, such as a new build directly from a developer.
As well as this, ensure all of your paperwork is in order. Apply for a mortgage in principle, so that you’re ready to go when you’ve made a decision on a property. Having all your paperwork in order will help conveyancers and estate agents get the ball rolling, giving you the best possible chance of completing any deal before the stamp duty holiday comes to an end.
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