On 8 July 2020 it was announced that there would be a Stamp Duty Land Tax (SDLT) holiday, this has seen a very large influx in Residential Conveyancing transactions across the UK, this coinciding with the Lockdown and other Covid 19 related implications has caused delays to mortgage lenders, surveyors, search providers and any law firms.

Our conveyancing staff have been working many additional hours in an effort to ensure that as many transactions as possible proceed to conclusion in an efficient and timely manner. We have recruited additional temporary staff to assist with this process.

However, we would like to bring your attention to several factors outside of our control that may prevent completion by the end of stamp duty deadline in March:

  • Searches – Ongoing delays in Searches at local councils, some of whom are still dealing with high backlogs due to Covid.
  • Lenders & surveyors – Ongoing delays with the Mortgage lenders and surveyors.
  • Other Law firms – Delays caused by other Law Firms, some of whom have taken on too much work or are still working from home.

THINGS YOU CAN DO TO HELP

  • Please do not constantly chase us, please do not ring us daily for progress updates as this will slow down our Conveyancing team and in turn reducing the likelihood of completing by the SDLT deadline
  • Please be prompt in answering any questions we ask you during the transaction.
  • As we get closer to the deadline, please work on the worst-case scenario that Stamp Duty will need to be paid.
  • Please have funds available to pay this should completion go through after the March deadline.
  • please ensure you plan ahead with removals firms.

Although we will strive to get your property transaction completed before the March deadline, this may not always be possible. We have set out below examples of how stamp duty is currently working and how it will work once the holiday comes to an end.

Rates from 8 July 2020 to 31 March 2021

Property or lease premium or transfer value SDLT rate
Up to £500,000 Zero
The next £425,000 (the portion from £500,001 to £925,000) 5%
The next £575,000 (the portion from £925,001 to £1.5 million) 10%
The remaining amount (the portion above £1.5 million) 12%

Example

In March 2021 you buy a house for £625,000. The SDLT you owe will be calculated as follows:

  • 0% on the first £500,000 = £0
  • 5% on the remaining £125,000 = £6,250
  • total SDLT = £6,250

Use the https://www.tax.service.gov.uk/calculate-stamp-duty-land-tax/#/intro to work out how much tax you’ll pay.

Rates from 1 April 2021

These rates also apply if you bought a property before 8 July 2020.

You can also use this table to work out the SDLT for the purchase price of a lease (the ‘lease premium’).

Property or lease premium or transfer value SDLT rate
Up to £125,000 Zero
The next £125,000 (the portion from £125,001 to £250,000) 2%
The next £675,000 (the portion from £250,001 to £925,000) 5%
The next £575,000 (the portion from £925,001 to £1.5 million) 10%
The remaining amount (the portion above £1.5 million) 12%

Example

In May 2021 you buy a house for £275,000. The SDLT you owe will be calculated as follows:

  • 0% on the first £125,000 = £0
  • 2% on the next £125,000 = £2,500
  • 5% on the final £25,000 = £1,250
  • total SDLT = £3,750