The Budget 2017: Stamp Duty Land Tax

The Chancellor’s Budget speech was heavily focussed on housing, with £44 billion promised over the next 5 years in the form of capital funding, loans and guarantees to build 300,000 new homes each year on average by the mid 2020s. A real problem for housebuilders is the lack of skilled tradesmen, and funding will be directed to encourage individuals to obtain skills in construction-related trades.

To encourage first time buyers, stamp duty (SDLT) is abolished from today on the purchase by a first time buyer of a house or other dwelling up to £300,000, and on the first £300,000 of a purchase of up to £500,000. But all joint owners must qualify for the relief. This can cause a problem. If for example a parent helps a child onto the housing ladder, perhaps guaranteeing a mortgage, the parent will often be included on the deeds. That will not only exclude the purchase from the relief, but will incur the extra 3% “second home” stamp duty charge. A purchase for £300,000 would then incur SDLT of £14,000.

Colin Tice, Tax Partner, Cassons.