My wife and I are enjoying our first property we bought back in June 2014. I can tell you we weren’t very happy about the 4% tax rate we had to pay on the whole of the purchase price considering it was not much above the 4% threshold. Stamp duty being a slab tax means when the purchase price crosses a threshold the new rate of tax applies to the entire purchase price not just the amount over the threshold.
Watching the autumn statement closely, we were glad to hear the Chancellor, George Osborne, has announced sweeping reforms to this unfair tax. It will now be a graduated tax so that when the purchase price crosses a threshold the new tax rate only applies to the amount in excess of the threshold.
The new rates of tax are
£000,000 – £125,000 0%
£125,000 – £250,000 2%
£250,000 – £925,000 5%
£925,000 – £1,500,000 10%
£1,500,000 upwards 12%
My joy over the reform was tempered somewhat after realising if we bought our flat today we would have saved more than £4,000!
