Will the 2016 Stamp Duty changes affect you?
How does this compare to the standard rates?
The standard rates of stamp duty apply to those who own one property, and there is nothing to pay on the first £125,000 of the purchase price.
For example, as of April 1st 2016 a First Time Buyer purchasing a £130,000 property would pay stamp duty of only £100. This calculation is based on zero % stamp duty on the first £125,000 and 2% above that bracket.
However, a landlord purchasing a Buy-to-Let property as of April 2016 at £130,000 would pay stamp duty of £4,000. This is calculated as 3% of the first £125,000 and 5% on the remainder.
It isn’t only landlords that will be affected by these changes. Those hoping to help their children onto the property ladder by being named on a mortgage will also face higher rates (assuming they own a home already). Furthermore, married couples will be treated as one unit so may only own one property together before paying extra stamp duty.
The good news is that you will not be affected on your principal residence. It has been confirmed that even if you already own a portfolio of properties you will not pay the higher rates on your own home.
There are also a few exemptions to the laws, which include caravans, houseboats and properties worth less than £40,000. Charities will continue to be excluded from the charges as well as companies that already own at least 15 properties.
The standard rates of stamp duty apply to those who own one property, and there is nothing to pay on the first £125,000 of the purchase price.
For example, as of April 1st 2016 a First Time Buyer purchasing a £130,000 property would pay stamp duty of only £100. This calculation is based on zero % stamp duty on the first £125,000 and 2% above that bracket.
However, a landlord purchasing a Buy-to-Let property as of April 2016 at £130,000 would pay stamp duty of £4,000. This is calculated as 3% of the first £125,000 and 5% on the remainder.
It isn’t only landlords that will be affected by these changes. Those hoping to help their children onto the property ladder by being named on a mortgage will also face higher rates (assuming they own a home already). Furthermore, married couples will be treated as one unit so may only own one property together before paying extra stamp duty.
The good news is that you will not be affected on your principal residence. It has been confirmed that even if you already own a portfolio of properties you will not pay the higher rates on your own home.
There are also a few exemptions to the laws, which include caravans, houseboats and properties worth less than £40,000. Charities will continue to be excluded from the charges as well as companies that already own at least 15 properties.