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STAMP DUTY CHANGES

It is looking likely that the temporary increase to stamp duty thresholds is ending in 2025 and moving back to the standard levels. Not only will this have a significant impact on the property market, both for first time buyers and those looking to upsize their current home, but it will negatively impact the property market on a whole.

In short, when the thresholds go back to the typical levels, it will basically raise the overall cost of purchasing a property. This will add huge amounts of financial strain to buyers who may already be at the very top level of their lending ability, but it will deter first time buyers looking to take that first step onto the property market. Given the current economic state, the vast majority of people will not have the available money to shoulder this increased tax, or even the ability to save the extra money needed.

Current levels, until March 2025, stand at;

  • 0% up to £250,000
  • 5% above £250,000 and up to £925,000
  • 10% above £925,000 and up to £1,500,000
  • 12% above £1,500,000

As it stands at the moment, from the 31st March 2025, this will change to;

  • 0% up to £125,000
  • 2% above £125,000 and up to £250,000
  • 5% above £250,000 and up to £925,000
  • 10% above £925,000 and up to £1,500,000
  • 12% above £1,500,000

For first time buyers, the nil rate threshold is currently at £425,000 and from the 31st March will return to the previous level of £300,000.

The end to this temporary increase will simply cause chaos in the housing market. Not only that, but the delay in homeownership will hugely impact younger generations, pushing affordability further out of reach in an economic environment that is already against them. Many are already feeling targeted by the other legislation changes that are hinted, and this may well be one of the final nails in the coffin for many people who were previously keen labour supporters.

Turner Little and its affiliates do not provide tax, legal or accounting advice. Material on this page has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction.