New Stamp Duty Rates

In September 2022, chancellor Kwasi Kwarteng announced new permanent changes to the rates of Stamp Duty payable on property purchases in England and Northern Ireland.

The changes were announced as part of a mini budget and are intended to help people buy property, move house, invest in residential property and step onto the property ladder for the first time.

Stamp Duty Land Tax changes September 2022

Stamp Duty rates on the purchase of property

From 23 September 2022, Stamp Duty will not be payable on the first £250,000 of the purchase price of a property. This has doubled from the previous threshold of £125,000 and means that around one-third of properties on the market will be exempt from Stamp Duty.

Rates are:

Portion of purchase price Stamp duty rate
£0 – £250,000 0%
£250,001 – £925,000 5%
£925,001 – £1.5m 10%
£1.5m + 12%

By way of example, if you are buying a property costing £295,000, Stamp Duty will be calculated as follows:

0% on the first £250,000

5% on the remaining £45,000 = £ 2,250

Total Stamp Duty payable: £ 2,250

Stamp Duty rates for first time buyers

First-time buyers buying a home for £625,000 or less are not required to pay any Stamp Duty on the first £425,000 of the purchase price, up from the previous limit of £300,000. For first time buyer properties priced at between £425,000 and £625,000, Stamp Duty is payable at 5% on the portion of the price between £425,000 and £625,000. The £625,000 figure is up from the previous limit of £500,000.

Mr Kwarteng said: “Homeownership is the most common route for people to own an asset giving them a stake in the success of our economy and society, so to support growth, increase confidence and help families aspiring to own their own home I can announce that we are cutting stamp duty.

“The steps we’ve taken today mean that 200,000 people will be taken out of paying stamp duty all together. This is a permanent cut to stamp duty effective from today.”

Rates for first time buyers are:

Portion of purchase price Stamp duty rate
£0 – £425,000 0%
£425,001 – £625,000 5%

Stamp Duty rates for buyers of second homes or investment properties

Those buying a second home or investment property will also benefit from the reduced rates, however a surcharge of 3% continues to apply. This includes jointly owned property. If you buy a second property but sell your first property within 36 months, you can claim back the Stamp Duty.

Rates for buying a second or subsequent home are:

Portion of purchase price Stamp duty rate
£0 – £250,000 3%
£250,001 – £925,000 8%
£925,001 – £1.5m 13%
£1.5m + 15%

Stamp Duty savings

By way of example, if you are buying a property for £500,000, Stamp Duty will be £12,500. Before the changes, the bill would have been £15,000. If you are a first time buyer, the bill will drop from £10,000 to £3,750.

For someone buying a second home for £200,000 and who therefore needs to pay an additional 3% of Stamp Duty, the amount payable is now £6,000. Previously it would have been £7,500.

If you have any questions about buying a property or you would like us to calculate how much Stamp Duty will be payable, please feel free to call and speak to one of our property team and we will be happy to help.

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If you are thinking of buying or selling your home and you would like to speak to us, please call on 01482 300 200, email us at welcome@lockings.co.uk or fill in our contact form and we will call you back promptly for a FREE initial chat.

We have offices in Beverley, Hull and York and deal with property sales and purchases in East Yorkshire and beyond.

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