HM Treasury - Stamp Duty Land Tax exemption limit increased (UPDATE 14th August 2009)

Further to the report below, HMRC have extended the deadline date to the 31st of December 2009 before the 1% Stamp Duty threshold returns to the £125,000 figure.

The website link for this reference is: HMRC Stamp Duty Thresholds

Thank you to Catherine Allen at SAS Daniels Solicitiors for this added information.

Further to last years Treasury announcement of a temporary increase in the lower threshold for Stamp Duty Land Tax to £175,000, we are now in the closing month before the limit returns to the previous level of £125,000.

As yet there have been no indications from the Treasury that this increase will be extended beyond September 2009 and as such any buyers wishing to take advantage of the increase should act fast.

Given that property purchase transactions take some 6 to 8 weeks, most buyers will now have missed the boat to take advantage of this temporary increase.

Stamp Duty Land Tax rates will return to the following levels in September 2009:
- Property purchases not exceeding £125,000 will incur no Stamp Duty Land Tax Charge
- Property purchases over £125,000 but not exceeding £250,000 will incur a 1% Stamp Duty Land Tax Charge
- Property purchases over £250,000 but not exceeding £500,000 will incur a 3% Stamp Duty Land Tax Charge
- Property purchases exceeding £500,000 will incur a 4% Stamp Duty Land Tax Charge

Since the 'leak' from the Government back in August 2008 that the Chancellor was 'considering' proposals for boosting the housing market, on Tuesday 2nd September 2008 we saw a press release from the Treasury.

It is understood that the Chancellor was considering measures for the deferment of payment of this tax or temporary suspension of such charge.

This announcement tells us that the lower level has been increased from £125,000 up to £175,000 for a 12 month period.

Whilst this will encourage some buyers back into the market place, the higher limits of £250,000 and £500,000 at which Stamp Duty is charged at 3% and 4% respectively should perhaps also have been reviewed and increased accordingly to encourage buyers at these levels to further their house purchase goals.

The new level will assist those buyers (especially First Time Buyers) wanting to purchase properties below this new level, but unless the sellers of those properties have some incentive to make their onward move, potentially into these higher bands, it is unlikely to have much of an impact.

The wording from the Treasury's website is detailed below.

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