Stamp Duty

[Staz]

Any solicitors on here?

The chancellor has just announced that the stamp duty threshold for first time buyers will rise to £250,000 from midnight tonight. Great news I think, however I have already exchanged contracts so I don't know if that means I will still have to pay or not.

I've been on the phone to the solicitors and as they haven't had the info passed to them yet they don't know if I'll have to pay or not. The girl suspects that I will though.

Anyone know? Or is there anyone who was midway through a purchase when the threshold was raised last year?

Thanks

 

[Ads]

Just read an article about the rise in stamp duty 10 years ago.
It said that as long as contracts were exchanged before the rise then buyers would still pay duty at the lower rate; even if completion was after the increase.
Applied to this situation; I would guess that the rate of stamp duty (or in your case, whether or not you pay it) is based on the law at the date you exchanged, as this is when the purchase/sale became binding.

HOWEVER, I also read this:

The effective date is normally the date of completion, not the date of exchange of contracts. However, the effective date may be earlier than the date of completion if the contract is substantially performed, for example, if the purchaser takes possession or pays the purchase price in advance of completion.


Maybe they allow you to pay at the rate which benefits the buyer? Although this is the government so probably not!!

So basically I don't know!!!

 

[Ads]

Right........... I don't think you will have to pay:


For SDLT the date of the contract is not relevant; what matters is the date of 'substantial performance', i.e. when the contract is actually implemented. Usually that date will be the date of completion but that is not the only way in which a contract can be substantially performed. Substantial performance happens on the earliest of:
· completion;
· the purchaser taking possession the property; and
· payment or provision of at least 90 percent of the purchase consideration.


The two in your favour are taken from HMRC's site. :icon_thumright:

 

[Staz]

I have actually called the HMRC helpline in the mean time and the lady said she wasn't allowed to comment until they get finalised information after the report is announced. What she did say was that on previous drops it went on the completion date, as you've C&Pd, but of course that doesn't mean the same for this drop.

I knew I'd have to wait for confirmation but the suspense is killing me!!

 

[Ads]

I can imagine mate! I'll keep my fingers crossed for you. It's potentially a very nice saving!
Wish this had happened two years ago before I bought my place; I'd be driving a much newer Audi then!