2021 Budget – An extension to the SDLT Holiday
Following much speculation over the past few months, it has been announced in the 2021 Budget that the Stamp Duty Land Tax (SDLT) Holiday is to be extended to the end of June 2021.
Last year we reported on the announcement that the Chancellor Rishi Sunak announced a Stamp Duty Land Tax (SDLT) holiday for residential properties in England and Northern Ireland. The SDLT holiday applies to all residential purchases. The holiday is a relief on tax payable on the first £500,000 of the price paid for a residential property and this will continue to apply until 30 June 2021. Following this time, SDLT will be charged on purchase prices after the first £250,000 until 30 September 2021. The lowest band for residential SDLT liability will then return to £125,000 on 1 October 2021.
The SDLT holiday will mean that a buyer of property costing up to £500,000 will not be required to pay any SDLT, representing a saving of up to £15,000. For purchases of more than £500,000 SDLT will be payable on temporary bandings based on the purchase price. This calculation is based on the standard residential rates with no other relief applied and will temporarily replace the first-time buyers’ relief.
So far we have seen significant pressure on the conveyancing system and residential plot sales to reach completion by the previous deadline of 31st March. This announcement will relieve some of this pressure in the short-term and give others the opportunity to benefit from the holiday. Nationwide Building Society have calculated that the average price of a home rose by 0.7% since the introduction of the SDLT holiday. There is some anticipation that the rise in house prices may continue until the new deadline, leading to the market becoming subdued later in the year, but whether this occurs remains to be seen.
If you require further advice regarding the purchase of land or any other Real Estate matter, please contact Steph Richards in our Real Estate department. You can also email your query to email@example.com, call 01276 686222 or use the contact form below.
This reflects the law at the date of publication and is written as a general guide. It does not contain definitive legal advice, which should be sought as appropriate in relation to a particular matter.
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We are solicitors in Camberley, Wokingham and London. In 2019, Herrington Carmichael won ‘Property Law Firm of the Year’ at the Thames Valley Business Magazines Property Awards, ‘Best Medium Sized Business’ at the Surrey Heath Business Awards and we were named IR Global’s ‘Member of the Year’. We are ranked as a Leading Firm 2020 by Legal 500 and Alistair McArthur is ranked in Chambers 2020.