More than two thirds of homebuyers in England and Wales will benefit from the stamp duty (SDLT) reforms announced in the Autumn Statement 2014, according to research by Nationwide.
The research, based on analysis of government house price data, found that 71% of house purchases in England and Wales will see a SDLT reduction.
From 4 December 2014, SDLT has been charged on the proportion of the house price that falls within a certain rate band. This is different from the old ‘slab rate’ system which used to charge SDLT on the total value of the property.
Nationwide’s research suggests that London and the South East will see the highest proportion (86%) of transactions reduced by the new system.
Under the new system, SDLT will be charged as follows:
- 0% on property worth up to £125,000
- 2% charged on property worth between £125,001 and £250,000
- 5% charged on property worth between £250,001 and £925,000
- 10% charged on property worth between £925,001 and £1.5 million
- 12% charged on property worth over £1.5 million.
Commenting when the measure was announced, Chas Roy Choudhury, head of taxation at the Association of Chartered Certified Accountants, said:
“Abolishing the single slab rate is a welcome move to end the significant distortions of this burdensome tax.”