74% of First-Time Buyers pay Stamp Duty
August 3, 2017
Last year, 74% of first-time buyers* paid Stamp Duty Land Tax when they bought their property. Stamp duty is payable on properties worth more than £125,000 (£145,000 in Scotland, where Land and Buildings Transaction Tax applies).
The figures show that just a quarter of first-time buyers bought properties worth less than the stamp duty threshold of £125,000, down from 47% in 2006. With the average property costing over £200,000, according to figures from the Land Registry, more and more first-time buyers are finding themselves paying this tax.
Calculating the tax
Where a property is worth in excess of the nil-rate band, the amount up to £250,000 is charged at 2%, and between £250,000 and £925,000, 5%. This means that first-time buyers purchasing a property for £275,000 would pay £3,750 in stamp duty in England and Wales, and £3,350 in Scotland.
Some commentators have called for the tax to be levied against the seller, not the buyer, to help reduce costs for those entering the housing market.
*Yorkshire Building Society 2017
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It is important to take professional advice before making any decision relating to your personal finances. Information within this article is based on our current understanding and can be subject to change without notice and the accuracy and completeness of the information cannot be guaranteed. It does not provide individual tailored investment advice and is for guidance only. Some rules may vary in different parts of the UK.