Second home buyers and buy-to-let investors could potentially save thousands of pounds due to the stamp duty holiday.
All property buyers benefit from the tax break announced by Chancellor Rishi Sunak last summer, which was later extended and tapered until September.
This means those buying additional properties, such as a second home or as an investment, only pay the tax at a rate of 3pc on the first £500,000 of a property’s price.
Outside the holiday, these buyers would pay this surcharge on the first £125,000, after that they were charged 5pc on the next £125,001 to £250,000, with the rates increasing as the property value did. It applies to homes purchased in England and Northern Ireland.
When does the stamp duty holiday end?
The stamp duty holiday was originally set to end on March 31 this year, but was extended in the Budget until June 30. After this date a tapered tax break, where the reduced rate will apply up to a threshold of £250,000, will then be introduced for three months until September 30. Thereafter, the threshold for paying the higher rate of stamp duty will be reinstated at £125,000.
Since April 2016, anyone buying an additional property – essentially, second homes and buy-to-lets – has had to pay an additional three percentage points in stamp duty. The charge applies above the normal stamp duty rates.
Now the normal stamp duty rates have been cut, those buying an additional home will also benefit. They will pay 3pc tax on the first £500,000 of the property’s price, 5pc on the value between £500,001 to £925,000, 13pc on the next £575,000 (the portion from £925,001 to £1.5m) and 15pc on anything over £1.5m.