Stamp duty holiday: How to calculate SDLT savings as ‘overall winner’ from cut revealed

The Chancellor Rishi Sunak announced he would be raising the SDLT threshold to £500,000 today, while delivering his summer statement in response to the coronavirus crisis. The change takes effect immediately, and it will last until March 31, next year.


  • Stamp duty holiday: Rishi Sunak raises SDLT threshold in announcement

He told MPs: “Today I am increasing the threshold to half a million pounds,” before going on to add that nine out of 10 people of main home buyers would pay no SDLT at all during this time.”

Mr Sunak added that these people would benefit by saving £4,500 on average.

Following the announcement, Lucy Pendleton, property expert at independent estate agents James Pendleton, shared her reaction, saying: “The London market is the overall winner from this intervention on stamp duty.

“It’s the only place in the country where buyers of all kinds will benefit en masse from more significant savings simply because property is more expensive.

“Although buy-side incentives like this are always criticised for increasing home hunters’ budgets, and by extension prices, they nevertheless always seem to successfully stoke demand too, and this obviously is the Chancellor’s goal.

“The national market takes its lead from the London market, and the latter has seen growth cooling more significantly than anywhere else lately, so this is a strategic move to lend what is arguably the country’s most important market a softer landing.”

Sharron Carle, Tax Solicitor who specialises in real estate transactions at Keystone Law, commented on the news.

She said: “What a great announcement for home buyers. The typical SDLT payable on the first £500,000 of a residential purchase for a homebuyer is £15,000.

“This is an instant saving for all homebuyers in the country.

“Whilst buy to let investors won’t receive a complete ‘holiday’ from the tax, due to the additional three percent charge which will still apply, there is still a very worthwhile saving to be had as they too benefit from the rise in the threshold.

“Yesterday a buy to let investor would have paid £30,000 on a purchase of a residential property for £500,000, today that charge has been halved to £15,000.

“Coupled with reliefs available to investors for multiple property acquisitions, the window of SDLT savings achievable from today until March 31 2021, will undoubtedly be just the boost the housing industry needs.”


  • How to improve mortgage approval chances ahead of stamp duty changes

Prior to this change, the SDLT threshold began at £125,000. This differed for first-time buyers able to claim the Stamp Duty relief for first-time buyers.

It’s possible to work out how much Stamp Duty will amount to on a property online.

This can be done via HM Revenue and Customs’ (HMRC) tool on the GOV.UK website.

However, at the time of writing, the service was yet to be updated with the new temporary threshold.

The Money Advice Service also hosts a Stamp Duty calculator.

This can be used to calculate SDLT on a residential property purchase in England or Northern Ireland.

It’s expected that these tools will be updated in the near future.

Prior to this temporary change, the SDLT rates applied as follows:

  • Property or lease premium or transfer value of up to £125,000 – zero percent SDLT rate
  • The next £125,000 (the portion from £125,001 to £250,000) – two percent rate
  • The next £675,000 (the portion from £250,001 to £925,000) – five percent rate
  • The next £575,000 (the portion from £925,001 to £1.5 million) – 10 percent rate
  • The remaining amount (the portion above £1.5 million) – 12 percent rate

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