The Autumn budget and what it means to Stamp Duty Land Tax

The Chancellor Philip Hammond announced changes for first-time buyers in the Autumn Budget, which has ramifications for Stamp Duty Land Tax (SDLT).

As announced at Budget 2018, the relief for a first-time buyer purchasing a qualifying shared ownership property has been extended.

Prior to the announcement, relief was available only for a shared ownership property purchase where the purchaser elected to pay the SDLT upfront on the market value of the property. This change means that purchasers who don’t market value elect but who instead decide to pay the SDLT in stages will also benefit from the relief.

Relief will be applied to the first share purchased where the market value of the shared ownership property is £500,000 or less. No SDLT will be due where they pay £300,000 or less for the first share. Those paying between £300,000 and £500,000 for their first share will pay SDLT at 5% on the amount in excess of £300,000.   No SDLT will be charged on the rental payments.

This change is backdated to apply to transactions which completed on or after 22 November 2017. This means that a refund of tax will be payable for those who paid SDLT after 22 November 2017 in circumstances which now qualify for first time buyers’ relief.

The relief must be claimed in an SDLT return, or by amendment where a SDLT return has already been filed. The amendment window for those who completed their transaction before 29 October 2018 is extended to 28 October 2019.

First-time buyers’ purchasing shared ownership property where the market value is more than £500,000 will not be entitled to the relief and will pay SDLT at the standard rates.

More detailed guidance about Stamp Duty Land Tax: relief for first time buyers is available.

This measure does not apply in Scotland as SDLT was devolved to Scotland on 1st April 2015, or to transactions in Wales on or after 1st April 2018 when was SDLT was devolved to Wales.

Kindly shared by sdlt.com