Get Even More Visitors To Your Blog, Upgrade To A Business Listing >>

Second-homebuyers in Wales facing stamp duty countdown

countdown

In Wales, stamp duty is being replaced by land transaction tax (LTT), and time is running out for some homeowners hoping to benefit from a tax loophole.

Last month, the Welsh government announced changes which mean that those who sold a main residence before November 2015, and own at least one other property, now only have until April 2018 to buy a new main residence to avoid paying a 3% Stamp Duty surcharge on top of the existing rates of the tax.

This is in contrast to the original legislation that gave buyers 36 months – until November 2018 for homes sold before November 2015 – to buy a replacement home in Wales before they would be liable to pay the extra stamp duty, a surcharge that came into effect in April last year.

Those who sold their main home after the November 2015 cut-off point should still be allowed the 36-month deadline, although the Welsh government has not clarified this. Further to this, if someone bought a new main residence before selling their original one – and therefore paid the 3% surcharge applicable for owning multiple homes – they would be able to apply for a refund if their original home is sold within 36 months.

What is land transaction tax?

The new LTT is set to replace stamp duty in Wales in April 2018, and will mean that those buying cheaper homes will pay less stamp duty than the current British system, and pricier homes will be charged more. Nine out of ten buyers will pay the same or less tax than before, according to the finance secretary.

The minimum threshold is rising from £125,000 to £150,000, meaning that the average home in Wales – at £150,846 – will only be eligible to pay £21.15 in LTT, rather than £516.92 in the current system.

A spokesman for the Welsh Government said: “We are carefully considering the transitional issues related to the change from stamp duty to LTT in a number of areas, including those related to the surcharge.”

Current system in England:

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%

New Welsh system from April:

Up to £150,000 Zero
The next £100,000 (the portion from £150,001 to £250,000) 2.5%
The next £150,000 (the portion from £250,001 to £400,000) 5%
The next £350,000 (the portion from £400,001 to £750,000) 7.5%
The next £750,000 (the portion from £750,001 to £1.5m) 10%
The remaining amount (the portion above £1.5 million) 12%

The post Second-homebuyers in Wales facing Stamp Duty Countdown appeared first on BuyAssociation.



This post first appeared on BuyAssociation, please read the originial post: here

Share the post

Second-homebuyers in Wales facing stamp duty countdown

×

Subscribe to Buyassociation

Get updates delivered right to your inbox!

Thank you for your subscription

×