Stamp duty holiday – when does it end?

Stamp duty holiday, or more accurately the temporary reduced rates of Stamp Duty Land Tax (SDLT), applies to residential properties purchased in England and Wales from 08.07.2020 until 30.06.2021 and from 01.07.2021 to 30.09.2021 inclusive.

The reduction in the Stamp Duty Land Tax is due to the temporary increase to the nil rate band, which is the rate before you start paying SDLT on residential property.

Below we outline all the relevant dates and stamp duty rates that apply.

Stamp duty holiday – when did it start?

The so-called stamp duty holiday was originally announced by the Chancellor on 8 July 2020 and became effective immediately. By increasing the nil rate band, the aim was to keep the housing market buoyant during the COVID-19 pandemic. At the time, the Chancellor said the move would save the average house buyer £4,500.

Stamp duty reductions extended in Budget 2021

At Budget 2021, these reduced rates were then extended until 1 July 2021 and a transitional rate was also introduced, with this rate available until 30 September 2021.

This means that the temporary nil rate band of £500,000 will be in place until 30.06.2021. Following this, from 01.07.2021 up to 30.09.2021 the nil rate band will be £250,000. From 01.10.2021, the nil rate band will return to the standard amount of £125,000.

It is important to note that the rate of Stamp Duty Land Tax which applies to a purchase depends on the completion date of the purchase and not the date contracts are exchanged.

What are the stamp duty rates?

below are the Stamp Duty Land Tax rates for the relevant dates:

Residential Stamp Duty Land Tax rates 08 July 2020 to 30 June 2021

Property or lease premium or transfer valueSDLT rate  
Up to £500,000Zero
The next £425,000 (the portion from £500,001 to £925,000)5%
The next £575,000 (the portion from £925,001 to £1.5 million)10%
The remaining amount (the portion above £1.5 million)12%

Residential Stamp Duty Land Tax rates 01 July 2021 to 30 September 2021

Property or lease premium or transfer valueSDLT rate  
Up to £250,000Zero
The next £675,000 (the portion from £250,001 to £925,000)5%
The next £575,000 (the portion from £925,001 to £1.5 million)10%
The remaining amount (the portion above £1.5 million)12%

Residential Stamp Duty Land Tax rates from 01 October 2021

Property or lease premium or transfer valueSDLT rate  
Up to £125,000Zero
The next £125,000 (the portion from £125,001 to £250,000)2%
The next £675,000 (the portion from £250,001 to £925,000)5%
The next £525,000 (the portion from £925,001 to £1.5 million)10%
The remaining amount (the portion above £1.5 million)12%

The sale of residential property and the 30 day capital gains tax requirement

Capital Gains Tax on property is charged at different rates than other assets and for residential property. Since April 2020, there is a requirement to report and pay any taxable gains on residential property within 30 days of the completion of a sale.

Capital Gains Tax is potentially payable on any gain made from the disposal of a property. As well as a sale, disposals can also mean gifting a property or transferring it to someone else, other than a spouse or civil partner.

You can read more about this here in our article “Capital Gains Tax on Property – the 30 day rule for residential property”

How Alexander & Co can assist you

At Alexander & Co, all our tax accountants are fully certified, ensuring we provide expert advice to help reduce your tax liability as much as possible and keep you on the right side of HMRC.

We offer a complimentary initial consultation to review your personal circumstances and discuss the best route forward. This can be arranged face to face, or if you prefer via phone or video call.

Should you need advice on calculating your capital gains tax liability, filing your tax return or negotiating with HMRC our team is able to assist. We work with a wide range of clients across the UK, from individuals, through to incidental landlords, buy to let investors and larger investors and developers.

Contact Us

For further assistance, our expert tax team at Alexander & Co will be more than happy to assist you. Please contact us using the form on this page, call us on 0161 832 4841 or email info@alexander.co.uk.

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