Stamp duty cut: How much will you pay to move home after the mini-Budget change?

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Today, Chancellor Kwasi Kwarteng announced a reduction in stamp duty, but homebuyers hoping for a major overhaul will be disappointed.

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The threshold at which stamp duty takes effect will be doubled immediately and permanently from £125,000 to £250,000, but the rates will not change, meaning a maximum savings of £2,500.

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For those who buy a home for an average of £270,000, this will mean their bill drops from £3,500 to £1,000.

New buyers will see their exemption level raised from £300,000 to £425,000 and they will not pay stamp duty up to that level, saving them a maximum of £6,250.

STAMP DUTIES RATES UNDER THE NEW SYSTEM
Group Land tax rate Additional rate for landlords / second homes
First time buyers pay between 0% and £425,000, after which regular rates apply.
0 – £250,000 0% 3%
£250,001–925,000 5% eight%
£925,001–£1.5m ten% 13%
£1.5M+ 12% fifteen%
* Stamp duty is not payable on real estate transactions of less than £40,000 as they are considered low value and are not reported to HMRC.
STAMP DUTIES RATES UNDER THE OLD SYSTEM
Group Land tax rate Additional rate for landlords / second homes
First time buyers pay between 0% and £300,000, then regular rates apply.
0 – £125,000 0% 3%
£125,001–250,000 2% 5%
£250,001–925,000 5% eight%
£925,001–£1.5m ten% 13%
£1.5M+ 12% fifteen%
* Stamp duty is not payable on real estate transactions of less than £40,000 as they are considered low value and are not reported to HMRC.
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The move in the so-called mini-budget is a cut in one of the UK’s least-loved taxes, one that has a much bigger impact on some shoppers than others.

While early buyers are exempt from stamp duty and those who buy a home in the UK for an average of £270,000 face a bill of around £3,500, people buying family homes in more expensive areas may face bills of around £3,500. tens of thousands of pounds.

But permanently reducing the mini-budget to stamp duty, so nothing is paid up to £250,000, will save people far less than Rishi Sunak’s previous stamp duty holiday, which eliminated the tax to £500,000.

With the mini budget stamp duty reduction, buyers will save a maximum of £2,500, while with the Sunak stamp duty holiday, they can save a maximum of £15,000.

How much stamp duty would you pay now?

Average house £270,000: £1,000 – saving £2,500

£350,000 at home: £5,000 – saving £2,500

£450,000 at home: £10,000 – saving £2,500

£500,000 at home: £12,500 – saving £2,500

£750,000 at home: £25,000 – saving £2,500

£1,000,000 at home: £41,250 – saving £2,500

Kwasi Kwarteng’s mini-budget has seen a permanent reduction in stamp duty, but this will save buyers no more than £2,500.

How stamp duty works

Stamp duty is levied on the purchase price of a home and is leveled off at various rates above thresholds.

Early buyers had a stamp duty exemption of up to £300,000, which has now been raised to £425,000.

Stamp duty had previously exceeded the £125,000 threshold at 2 per cent, and then increased to 5 per cent above £250,000.

The first £250,000 is now tax-free, and amounts beyond that are subject to a 5% rate up to a 10% threshold of £925,000.

George Osborne’s last major permanent stamp duty reform resulted in lower bills for some homebuyers lower in the price ladder and the edges of the cliff removed, but higher fees for those buying high-end homes.

Stamp duty bills are still significant for those buyers on Kwasi Kwarteng’s cut, but they will see a £2,500 cut.

In April 2016, the stamp duty on the purchase for the purpose of letting and other additional real estate was reformed, adding a new 3% surcharge to all rates. This will remain in line with the new higher threshold system.

The best mortgage rates and how to find them

Mortgage rates rose substantially as the base rate of the Bank of England rose rapidly.

Whether you’re looking to buy your first home, move or remortgage, or are a landlord buying to rent, it’s important to get good independent mortgage advice from a broker to help you find the best deal.

To help our readers find the best mortgage, This is Money has partnered with L&C, an independent free broker.

Our mortgage calculator With the support of L&C, you can filter offers to see which ones match your home’s value and deposit level.

You can also compare various fixed rate mortgage lengths, from two-year to five-year and ten-year fixed rates, with monthly and total costs.

Use the tool below to compare the best offers with commissions and rates. You can also launch the online application at any time and save it as you go along.

> Compare the best mortgage deals available now

Credit: www.dailymail.co.uk /

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