To boost the property market after the first COVID-19 shutdown, the Chancellor introduced a Stamp Duty Land Tax (SDLT) holiday for residential properties. If you are buying your first or only home in England or Northern Ireland for up to £500,000, you will pay no SDLT, where the deal is completed by midnight on 31 March 2021.
If you are purchasing a holiday home, or a buy-to-let investment property, the 3% surcharge of SDLT still applies on the full value of the deal.
Where the property is located in Wales, Land Transaction Tax (LTT) applies. The starting rate for LLT has been raised to £250,000 for those buying or replacing their main home by 31 March 2021. However, there is no LTT reduction at all where the property is to be let out or used as a second home.
In Scotland, purchasers of residential property also enjoy a holiday for Land and Buildings Transaction Tax (LBTT) until 31 March 2021. In this case, the LBTT starts to bite at £250,000 for the acquisition of the main home.
Purchasers of second homes or buy-to-let properties must pay an additional LBTT surcharge of 4% on the full value.
Where you are planning to buy a residential property, you need to complete by 31 March to save tax. It is very unlikely that these land tax holidays will be extended.
