A STAMP Duty cut will end in 2025 the government has announced.
Chancellor Jeremy Hunt revealed the change to housing tax in his Autumn Statement today.
It follows a recent cut that means that thousands of homebuyers pay less Stamp Duty.
Jeremy Hunt confirmed in a statement a few weeks ago that the cut to Stamp Duty would remain in place.
But now he has set a date for it to end, as he announced a raft of measures aimed at balancing the books.
He said: "The OBR expects housing activity to slow over the next two years, so the Stamp Duty cuts announced in the mini-budget will remain in place but only until March 31 2025."
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Do first-time buyers pay stamp duty?
Tax rises for millions confirmed by Jeremy Hunt in Autumn Statement
Stamp Duty land tax (SDLT) is a lump sum payment you have to make when purchasing property over a certain threshold.
Ex-Chancellor Kwasi Kwarteng announced the cut to Stamp Duty in his mini-budget in September in a bid to boost economic growth.
Before the cut, no Stamp Duty was paid on the first £125,000 of any property purchase.
That's now double at £250,000 for all home purchases.
The threshold at which the duty was paid for first-time buyers was £300,000. But that is now £425,000.
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3The maximum value of a property on which first-time buyers’ relief can be claimed also increased from £500,000 and is now £625,000.
How much buyers pay depends on the price and type of property, including if it's residential use or non-residential or mixed-use.
The increase to thresholds at which you pay the tax is saving some buyers thousands of pounds.
First-time buyers can save up to £6,250.
Mr Hunt has now said that this Stamp Duty will come to an end.
Although the Stamp Duty cut was good news for homebuyers, the mini-Budget caused market turmoil pushing up mortgage rates.
Higher loan rates make it harder to get on the property ladder.
Experts also now predict the housing market will cool and house prices could fall next year.
Tomer Aboody, director of property lender MT Finance said:"The Government is maintaining the Stamp Duty reduction for now in the hope that banks can also be more flexible when it comes to mortgages.
"This will enable the housing market to continue to perform, along with associated businesses within the sector, which is so important for the wider economy.
"By the time the Stamp Duty cuts are phased out by March 31, 2025 the UK should hopefully be in a much better place, particularly as long-term interest rates should be lower as inflation is brought under control."
In today's Budget Mr Hunt announced a raft of measures designed to get the economy back on track.
His predecessor's mini-Budget sent the pound plummeting and hit financial markets because tax cuts were unfunded.
Mr Hunt today set out fresh measures that come with costings from the OBR.
What is Stamp Duty?
Stamp Duty is a payment you'll need to make if you're buying a property or piece of land.
You pay the tax when you:
- buy a freehold property
- buy a new or existing leasehold
- buy a property through a shared ownership scheme
- are transferred land or property in exchange for payment, for example you take on a mortgage or buy a share in a house
The rate a buyer has to fork out depends on the price and type of property.
Rates of Stamp Duty are different in Scotland and Wales.
Who has to pay it?
Since, September 23, first-time buyers have not had to pay any Stamp duty on homes costing less than £425,000.
They only have to pay it on properties costing more than this.
This figure was previously £300,000 but was increased by former Chancellor Kwasi Kwarteng.
The maximum value of a property on which first-time buyer's relief can be claimed also increased from £500,000 to £625,000.
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Under the previous system, no Stamp duty was paid on the first £125,000 of all property purchases but the government has doubled that to £250,000.
Back in 2020 the Treasury temporarily raised the Stamp Duty threshold from £125,000 to £500,000 for sales of homes in England and Northern Ireland.
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