Stamp duty deadlines 2021 explained

If you’re buying a new home in England or Northern Ireland this year and complete before the 30th June 2021, you could save thousands of pounds with the government’s stamp duty holiday.

What is stamp duty?

When buying a home or land in England or Northern Ireland, if it costs more than £125,000 you will need to pay a tax called the Stamp Duty Land Tax.

Scotland and Wales have similar charges under a slightly different name.  

Why is there a stamp duty holiday?

England and Northern Ireland’s 2021 stamp duty holiday was introduced as part of the government’s Covid-19 recovery plan to help boost the economy which had slowed as a result of the pandemic.

The stamp duty rate payable on homes valued at up to £500,000 was reduced by 100% until 30th June 2021. For three months after the deadline ends, the tax break will remain for properties in England and Northern Ireland worth less than £250,000.

The stamp duty holiday is only applicable to residential homes.

The current deadline is an extension of the original date of the March 31st which it was thought may not give buyers enough time to complete their purchase.

Stamp duty is the second biggest cost buyers must pay so this tax break is intended to make it possible for more people to buy a new home.

When does the stamp duty holiday end?

The stamp duty holiday will end on the 30th June.

However, between 1 July and 30 September there will be an interim period when the holiday will still apply to properties valued at £250,000 or less.

For first time buyers, the cut off is raised a little higher during the interim, to £300,000 with a further reduction for another £200,000, providing a discount on properties worth up to £500,000 between July and September.

From 1 October, stamp duty rates will return to normal and be payable on properties worth £125,000 or more.

How much will I save?

The stamp duty holiday could save you up to £15,000 if you buy a home worth no more than £500,000.

When must I complete to qualify?

You will need to complete on your property by the 30th June to qualify for the tax break, this includes the exchange of contracts, transfer of funds and passing of the keys for the new property to you.

For help to acquire your mortgage quickly, get in touch with us today.

May 2021