The stamp duty tax holiday is due to end on 31st March 2021, and despite recent efforts, the government has ruled out another extension to the tax relief. However, as a property investor and developer, you can still benefit from this holiday period, read on to find out more.
There have been repeated calls for the government to extend the deadline to the stamp duty holiday; but, unfortunately, none have come into fruition.
Many senior partners who represent the home moving process in its entirety have written to the Chancellor, Rishi Sunak, highlighting how an extension would help guarantee buyers and sellers that their property deal will complete before the end of the stamp duty holiday (Propertymark). Even a petition was put to Parliament that received 65,735 signatures; however, the HM Treasury responded on 10th December emphasising how the stamp duty holiday was merely a temporary relief scheme.
“The SDLT (stamp duty land tax) holiday was designed to be a temporary relief to stimulate market activity and support jobs that rely on the property market. The Government does not plan to extend this temporary relief.”
The stamp duty holiday was first introduced during July to help boost the property market in England and Northern Ireland after the first coronavirus lockdown. Before the tax relief was introduced, buyers would expect to pay a proportion of the house price as stamp duty land tax on all properties valued over £125,000. For first-time buyers, this value was higher at £300,000. During the stamp duty holiday period, the tax threshold does not apply unless the property is sold over £500,000. However, for property investors and property developers alike, you will still have to pay a proportion of stamp duty land tax. For properties up to the value of £500,000, the additional stamp duty is 3%. But, for many buy-to-let investors, you can still reduce your stamp duty land tax bill by more than a third, as long as the deal is completed before the deadline.
Completing your next investment before the stamp duty holiday deadline.
With the right team in place and getting ahead of the process, it is still possible to complete a sale before 31st March 2020. But you will have to act fast.
If you are purchasing an additional property or a property for buy-to-let, a 3% surcharge will apply on top of the standard stamp duty rates. Despite this charge, if you then sell a property within three years of purchasing a second property, you are eligible to apply for a refund of this 3%.
Check out our article offering advice to anyone trying to complete before the stamp duty deadline here.