One of the Autumn Statement announcements is a major reform to SDLT on residential property transactions. Historically SDLT has been charged at a single percentage of the price paid for the property, depending on the rate band within which the purchase price falls. From 4 December 2014 each new SDLT rate will only be payable on the portion of the property value which falls within each band. This will remove the distortion created by the existing system, where the amount of tax due jumps at the thresholds.
Where contracts have been exchanged but not completed on or before 3 December 2014, purchasers will have a choice of whether the old or new structure and rates apply. This measure will apply in Scotland until 1 April 2015 when SDLT is devolved to the Scottish Parliament.
The new rates and thresholds are:
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Purchase price of property
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New rates paid on the part of the property price within each tax band
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£0 - £125,000
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0%
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£125,001 - £250,000
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2%
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£250,001 - £925,000
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5%
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£925,001 - £1,500,000
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10%
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£1,500,001 and above
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12%
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The government believes that this reform makes SDLT more efficient and fairer, and ensures that SDLT will be cut for 98% of people who pay it.
Please contact us if you have any queries on this issue.
Internet link: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/382324/Stamp_Duty_15.pdf