Yesterday, the Chancellor Rishi Sunak announced a cut to stamp duty land tax (SDLT) in a hope to encourage more confidence in the housing market.
Plans to immediately cut Stamp Duty costs on the first £500k of a property in a move that will save the average house buyer £4,500 have been ‘cautiously welcomed’ by some residential law experts.
Remaining in place until 31 March 2021, the announcement comes as part of a post-Coronavirus budget which includes a series of initiatives to help the economy recover, with the Government suggesting that the high threshold will mean that an impressive 9 out of 10 people will pay no stamp duty at all.
However, while conveyancers have said the plans would come as a ‘welcome relief’ to those who are in the process of purchasing, it would be a ‘bitter blow’ for hundreds who had already finalised proceedings since the start of lockdown in March.
Sarah Ryan, Head of conveyancing at law firm Simpson Millar, said:
“We of course welcome the plans announced today to freeze the Stamp Duty costs on any property up to the value of £500k which will not only encourage potential buyers to move on and up the proverbial ladder, but will also help to retain jobs in the real estate sector.
“However, there is no denying that for some, in particular those individuals, couples and families who have managed to complete on the purchase of their home either during lockdown, or in the immediate aftermath, this will come as a bitter blow.
“This is most likely to affect those who have bought a new build property as many of those transactions could go ahead despite social distancing, as well as those who were all ready to finalise proceedings once the rules relaxed last month.
“We would urge the government to make the scheme retrospective so that those individuals can also benefit from the cost savings.”
The SDLT cut is only applicable to the English and Northern Ireland housing markets, which has caused estate agents in Scotland to implore their devolved Government to follow suit of their counter parts.
The need to mirror the lowering of stamp duty rates introduced south of the border is needed to avoid creating a two-tier housing market in the UK.
The Scottish equivalent of the SDLT, the Land and Buildings Transaction Tax (LBTT) is devolved to Holyrood and is already set at higher rates.
Struan Douglas, director of Edinburgh-based solicitors and estate agents Purdie & Co, said:
“It will be worrying if the Chancellor’s generous tax giveaways aimed at one part of the UK is not replicated here to allow the Scottish market to follow suit.
“A £500,000 starting threshold for the English SDLT might be helpful in boosting property sales in London and the south east, but it will not be helpful here.
“There needs to be a warning of the dangers of allowing the Land and Buildings Transaction Tax (LBTT) to remain at significantly higher levels than the property tax for England and Northern Ireland.
“The result could be the creation of a two-tier market, which could be damaging to property sales north of the border.”
He added:
“The market in Scotland is entirely different from London and the south-east. Houses in Edinburgh, for example, are generally more affordable, compared with average earnings, and there’s a shortage of rental property.
“In the major cities it can be difficult to secure a rental property. Students, professionals, foreign nationals and those on benefits are all competing for the same available rental lets.”
He also said:
“Any school pupil studying economics will tell you that when taxes rise, consumers change their behaviour accordingly, so it was no great surprise that many homeowners, faced with a massive increase in the cost of moving to a new house, opted to stay put and maybe spend the money on extending instead.
“The greatest negative impact was on the purchase of second homes and buy-to-let properties. Tax revenues are small compared with the high risks of restricting liquidity in the buy-to-let market and the knock-on effects on other businesses that rely on a buoyant property market.”
68 responses
so if someone buys a property for 510k do they pay stamp duty on 10k only?
Myself and my partner have been hit hard from the pandemic, we were supposed to move into our dream house on the 27th March, but due to the lockdown we were unable too. We were not able to move in until the 12th June, trying to keep everything on track so that we did not let the situation of the virus affect our future. Whilst having concerns over our jobs and whether we will have one, we were determined to carry on. We paid out everything that was required, after years of saving. We paid £9,000 in Stamp duty, and then 2 weeks later, it is removed. We urge the Government to backdate this to any house that has completed since the official lockdown started to ensure it is fair for everyone.
I totally agree. Me and my partner completed in may and we paid £5,000 stamp duty. This would really help us as we are scrimping and saving week by week. My jobs now at risk and it’s a very stressful time for not just me but soo many
I agree. I exchanged and completed last Thursday, I could easily have waited another week and benefitted from this scheme. It is grossly unfair and should be backdated to the beginning of Lockdown.
Completely agree. We took a risk continuing our move just days ago!! So upset. Our stamp duty cost could really make a difference to our already tight purse strings while we keep going!
We were in the same boat. All ready to move in on the 10 April. But lockdown put a stop to that. We were both furloughed . I still am. We completed on 3rd July. Only 5 days previous . GUTTED to say the least. I think it’s only fair that the likes of you and I who held our nerve despite uncertainty be helped out and our tax returned to us.
Please sign the petition http://chng.it/T7FksMJ6qG
Hi Megan and all,
Unsure if you have signed this, but if enough of us do hopefully can tip over the 10K needed. I am also in the same boat as many.
Amar
Its a bit of a blow for those who had compelted their purchase before 8th June. In my case we completed on the 7th July. I hope the Govt backdates, but again there will be many who will be my situation whatever the date it. given the pandemic circumstances, we braved the situation and ploughed through instead of pulling out, in my opnion all those who managed to complete during the lockdown should be eligible of the stampduty holiday.
Exactly all other schemes targeting other sectors can be backdated I am baffled why this isn’t.
Please sign the petition http://chng.it/T7FksMJ6qG
Megan my husband and I are in exactly the same position.
We are both key workers and worked tirelessly to keep the sale / purchase going during lockdown to assist the economy . We thought we were doing the right thing.
We completed 7 days ago paying £20,000 of our hard earned savings in stamp duty. Had we completed today it would be £5000.
We are considering a Judicial Review and have written to Rushi and our local MP. Maybe you could do the same
I am considering the same. all the best
Exactly all other schemes targeting other sectors can be backdated I am baffled why this isn’t.
Please sign the petition http://chng.it/T7FksMJ6qG
Good idea, will do likewise!
Ruth, we are in the same position. Our transaction went through on 1st July. One week later it would have saved us £12k. This is grossly unfair. I will write to both Rishi and my local MP. Has anyone started a petition on change.com?
Ruth, how do we start a judicial review? I have written to Rishi, Boris, my local MP and a lady called Sarah Ryan who is head of conveyancing at a law firm and lobbying government. I have also asked all of my friends to sign the government petition to refund stamp duty for anyone since lockdown.. I would happily jump up and down outside government building yelling like a fish wife if I anyone wants to join me. Please anyone let me know what I can do to help champion this cause.
Same situation here as well ..We paid 20 thousand pound stamp duty on 29/06/20. hope government would backdate stamp duty holiday from start of lockdown
Hello Ruth, I paid £13,500 on 30th June and have emailed Rishi Sunak. Please keep me informed of any proposed legal action you take. Good luck!
I am in the same situation and want to do the same
I am clapping for you. Well done Heroes!
Exactly all other schemes targeting other sectors can be backdated I am baffled why this isn’t.
Please sign the petition http://chng.it/T7FksMJ6qG
What is so frustrating is the Government relaxed the rules and allowed Estate Agents and viewings to commence from 13.5.2020. This then meant that we were given the green light to keep moving. It’s like we have been trapped into progressing and paying a fortune! Totally unfair.
Exactly all other schemes targeting other sectors can be backdated I am baffled why this isn’t.
Please sign the petition http://chng.it/T7FksMJ6qG
My parents completed on Tues which is a massive blow, they paid over £12k in stamp duty. I would recommend people to sign the change.org petition
Hi Amanda,
My husband i would definitely sign a petition…we completed a week ago, and have been saving up for so long to move house. We have worked throughout the whole pandemic, but on reduced salaries and longer hours. We have always paid tax and never seem to benefit from it. Getting our stamp duty back would be a huge help in completing work that needs doing to the house. Where would I find the petition please? Thank you!
https://petition.parliament.uk/petitions/310695
here is the petition running for it, kindly sign it and get signed by others.
Please post link.
Otherwise you can sign this.
Please sign the petition http://chng.it/T7FksMJ6qG
The Council for Licensed Conveyancers has said, “The temporary rates do not apply where the transaction was substantially performed before 8 July 2020”; I am trying to seek clarity on what “substantially performed” means, but it seems to be suggesting that anyone who was just waiting for the stamp duty holiday announcement before completion would not get it, whereas someone who is still some weeks away from completion would.
The stamp duty calculator works on completion dates to work out what is owed, so it may have been updated with a threshold period before 8 July, which takes account of a period where a transaction would normally be regarded as “substantially performed”.
Has anyone used the calculator since the 8th and noticed a change?
We completed 29th June, 12 days before… our stamp duty isn’t even due for payment until tomorrow technically. If there was any suggestion this was on the cards we’d have delayed.
I paid £5500 install duty a few weeks ago! Completely unfair if this isn’t backdated
Here is clarification from HMRC:
A contract will be substantially performed where the purchaser obtains “the keys to the door” and is entitled to occupy the property (however this is documented) or when the purchaser of a building that is let becomes entitled to receive the rents.
It is immaterial whether the purchaser takes possession under the contract or under a licence or lease of a temporary character.
Where the purchaser already has occupation of the premises under a different interest, for example when the purchase is of a freehold and the purchaser is a tenant, substantial performance will not be triggered at the time of the contract as long as the purchaser adheres to the covenants in the lease.
Where premises are entered into for fitting out that will count as possession and the time the trade commences is not relevant.
I’m also in the same position, my husband is not working and despite that we went along and completed in May. £10000 is stamp duty and to get that back would be life changing. I would welcome the backdate as it seems so unfair that in the midst of lockdown we all took the risk and did the right thing for us and the economy and this is how we are thanked?! If there’s a petition or something we can do to escalate I’d welcome the advise.
Completed two weeks ago and paid £9750.00 in SDLT. Moved to an empty house, could have waited a further two weeks to complete had we have known we would save £9750.00….
Hopefully the Government backdate this policy as clearly it has been unfair.
We completed on 31st March and on 1st April I was advised I was to be furloughed. On 23rd May my company announced they were starting the redundancy process and I’m still waiting to hear if I have a job to return to. I’m still on furlough and my earnings are significantly lower and basically just covers the mortgage. We were unable to move during the height of the pandemic and we were forced to pay rent and our new mortgage until restrictions lifted. Living in London we paid a hefty £20,000 in stamp duty, to get £15,000 refunded would mean we can get central heating in the very old property that we purchased. With my furloughed salary we are looking at a cold bleak winter without heating. Not quite how we imagined our first year in our first house.
We are in the exact same position and feel the Chancellor has not taken into account the personal circumstances of everyone that completed during the lockdown and the wider economic effects of leaving many of us who are already struggling in a more vulnerable having just lost out thousands of pounds. I would recommend sharing and signing the petitions on UK gov and change.org to make sure our voice gets heard and also writing to your local MP. https://petition.parliament.uk/petitions/310695
http://chng.it/Lp2mz7JC
Guys, has anybody started a petition yet to backdaye the tax cut to the beginning of the lockdown?
The same as everyone else, our sale and purchase were delayed because of the pandemic but despite the current economic uncertainty we decided to continue. My partner and I are both key workers and have worked incredibly hard throughout,.
Moving is stressful enough, and we’ve had quite a few issues with our new houses and losing out on the stamp duty holiday is the final kick in the teeth. Seems so unfair.
Can someone invent a link please so we can all sign, Like a petition so Mr Rishi Sunak/Government can backdate The stamp duty from the lockdown in March.
I believe it will be a great help for thousands of people.
Everyone please sign this petition
We have 4100 signatures so far but we need to get to 10000!
https://petition.parliament.uk/petitions/310695
There is a need to match the lowering of stamp duty rates introduced in England and Ireland in Scotland to avoid:
a) creating a wrong perception that these are different countries
b) creating a two-tier housing market in the UK.
The Scottish equivalent of stamp duty has only been discounted at 50% of what has been announced for England and Ireland, which does not make sense!
I agree, I was made redundant mid May by a heartless boss who couldn’t be bothered to subscribe to the furlough scheme. I needed to move desperately for personal reasons and decided to start what I had finished. I parted with 12.5k stamp duty on the 29th June. Wednesday’s news left me crying for two days. I’ve written to my local councillor, Boris, Rishi and to a lady called Sarah Ryan at a conveyancing firm who are lobbying the govt to back date the scheme. I’ve not heard back from anybody. Is there anything that can be done. Is there anyone else I can write to? 12 grand is a life changing amount of money, I would happily stand outside govt and scream a d shout if need be. If someone gas any ideas on how we can champion this cause, please please let me know.
Please sign the petition on change.org
I have been in the same situation as you all. When the government allowed estate agents to open we assumed they want us to get moving. We completed at the end of July, and then one week later they slapped us with up to 15K discount for those who waited.
My partner lost her job but we did not lose hope! I thought the government has let us carry on so we did. We did not see this one coming. If anything governments should have covered the period of lock down and specially after lock down when they encouraged us to go out.
I have written to my local MP and Rishi but does anyone know of any petition page we can sign ? I think one way to unit against this unfair situation is a petition page.
Totally agree. Cut offs are often arbitrary but in this situation it penalises all those who pushed on and helped to keep the property market alive from the start of lockdown up to 8th July, and in more trying circumstances than ever (and buying and selling property is not a picnic!). In our case, as with others, we’ve had to scrimp and save and then take a risk despite furloughed status to push on with our house sale and purchase or risk the chain collapsing (with a buyer threatening to pull out unless they could move ASAP once restrictions lifted). We completed at 3pm on 7th July, two days earlier than our original completion date (our buyer wanted to be in by Friday but to observe 3 days vacancy due To COVID) only to find on arrival at our new property that the vendors were only half packed. It’s taken a further two days for them to move out. The stamp duty holiday should be backdated.
We also did exchange and completion on 3rd July paying £16250 stamp duty, which caused me to pay my tax to HMRC in installments, otherwise I would not able to complete the purchase. Which is getting undigested that just after 2 working days, there is Stamp duty holiday. I would have rather used that money to pay my tax in full to HMRC or spend in other things in the house, which eventually help to local business, individual house contractor etc… There was no clue even with Conveyance firm. Please please, back date consider must be there since he lockdown implemented. Any way that money will be circulated to bring local business up, which is in line of Goverment’s vision. ..
This is a farce, why reopen the housing market in May/June and then weeks later change the stamp duty?? Makes no sense for the people that completed within the weeks of reopening up to 8th July 2020. I paid £8.5k in June 15th, we would of delayed the completion if we had an idea this is a possibility in this ‘mini budget’
I have also written an email to my local MP and have signed the following petition:
https://petition.parliament.uk/petitions/310695
Please all sign and share this around.
For those who were able to exchange and complete prior to this announcement and after lockdown started there is a petition that you can sign to argue that all SDLT paid during this period should also be refunded. We paid £14,500 of our earned savings that would otherwise have been used to carry out renovations to our new home. Part of the idea for the Stamp Duty holiday is to encourage house buyers to put the money that have saved back into the economy for home improvement works. The houses that were purchased during this period also assisted with keeping the economy moving at such a difficult time, so why should those people not benefit from the same as those purchasing properties on or after 8th July 2020. At the very least they should back date it to 13th May 2020 when the government announced that home moves could resume.
https://petition.parliament.uk/petitions/310695/
Also agree, we only moved into our house a fortnite ago so our stamp duty was not even legally due until today, after the announcement! I am gutted to lose all of that money after staying on track for all this time to ensure it went ahead!! We were even homeless for 13 weeks after completing our sale just inside the lockdown to make sure we didnt lose it!!
My husband and I are in the same situation that we didn’t want to let the seller down so we carried on and completed on the 9 June and paid £17,600 on stamp duty now to scrap the same stamp duty and my work is not secure now. I hope the government will look to back date it for people that complete during or after the lockdown.
We are the same, we feel betrayed by the government and our solicitor after we braved the move to help keep the economy going, we were going to wait a bit longer until end of summer to complete but our solicitor advised us there was no stamp duty holiday on the cards despite our inkling. My husband is self employed so we have not had any support during lock down and this is a further kick in the guts, we pay a lot in tax over the years but never seem to get any benefits back for being hard working! We paid £13k stamp duty on 25 June and that would have helped my husband’s business which is now likely to fold. This has taken the shine off our lovely new home !
My husband and I also bought our house in a week before lockdown. To hear now that stamp duty is freezing is very unfair. We paid a massive 38k in tax and 6 weeks after buying my husband had lost his job, so I really hope this is backdated to March along with the furlough scheme was backdated to 1st March. We could really do with the cash now as will take a while before jobs are going to come available. It has to be fair for lockdown holiday on stamp duty from the start. I know a lot of people will be saying well we have had to pay our tax, but they had jobs , they had a future, who would have predicted this happening. It is only fair Mr Chancellor.
I am in the same boat, I completed on the 3rd july and feel gutted that I lost out as I payed £12000 stamp duty.My husband was still working as a bus driver and worked all through the lock down so I feel the Government should back date the stamp duty hoilday to march as that is when panadamic started.But people like me that were in process of buying carried on fearing the future.
We completed on the 15th of June once restrictions were lifted and encouraged by the estate agents, we initially wanted to stop the sale but did not want to let the chain down , my partners private business suffered and is no longer viable, we payed nearly £13k stamp duty, I feel gutted for doing the right and keeping the process moving forward, I urge the government to do the right thing
Like Ruth Mann, my partner and I are both key workers and worked throughout the pandemic, travelling into London. We completed 4 weeks ago and could have saved £15k…. I cannot believe our luck, we pushed to exchange and complete and could have easily delayed. I feel sick!
I think sdlt exemption should be backdated. My purchase completed on 5th June which as a single parent I had really scrimped and saved for. When the estate agents re opened they put a lot of pressure on to complete the sale and as I needed the house I went ahead with the sale. Now a few weeks later I find out I could have saved £7k and I may potentially lose my job as now on furlough. Despairing. Please backdate this benefit.
We completed 14 days before the 8th of July and paid 20,000 in stamp duty. We had to hold off moving because of lockdown but then turned everything around as quickly as possible not wanting to pull out even though it did feel like a risk going ahead with the news property prices were falling. We feel sick that had we waiting just 14 more days we could have saved 15,000. I sincerely hope they back date the stamp duty holiday to the start of lockdown, so many people may find themselves in difficult financial situations which could be supported with a refund. Fingers crossed!
Totally unfair. I had no other option but to complete my new build purchase during the pandemic. Couldn’t even move in the place or get our furniture from storage. This should really be back dated to when the lock down took place. Especially for those who were unable to receive any form of financial payments such as salary during the pandemic.
I completed on 30th June and paid £13,500 stamp duty. I exchanged and completed in 10 days to suit someone in the chain. If we had waited 3 weeks we would be completing tomorrow and I would have paid no stamp duty. I am so bitterly disappointed and have lost sleep over this. I have signed the government petition to backdate to post lockdown moves and I urge readers of this article to do the same.
Does anyone know if the pressure is still being placed on the government to backdate? We have signed the petition and urged family and friends to do so but media pressure is the better way forward.
We completed on 3rd July. 11k stamp duty. 5 days too soon when we have been homeless since 17th Feb, living with family to separate the chain we were in. We were meant to complete mid March then lockdown stopped everything.
We have a 22 month old and we were looking to marry so my partner could have smothered same surname as our son but the equity in my house went on the deposit and our savings went on solicitors fees and stamp duty instead.
If we had any Idea this would happen, for the sake of 5 days we could have waited and had money for our wedding too.
We seem to have been penalised for pushing on and completing our purchase as soon as we were able. It’s a bitter pill to swallow.
Hope something can be done to help us and the hundreds (Or thousands?) like us who are in a similar position.
Could someone share the petition link here! I couldnot locate it. We have completed on 30th June and cost us £13k!
Hi Ali, the link is further down in the comments.
I have written to my local MP who is forwarded the e-mail to the chancellor… Who wants to join in instructing a solicitor to carry out a judicial review on this?
I would be up for that in theory, dependant on costs.
If there are enough of us then the costs will be split and may warrant the work involved
We completed on the 7th July at around 13:00… our stamp duty was £14250 for our home, we have had such a bad time during this lockdown and even had to borrow money from friends to cover this as we had to pay for my mum’s funeral…
https://petition.parliament.uk/petitions/310695
Please sign this one, it’s very close to being owed an official response
I was wondering whether we should all start a contact group or something to discuss options or progress? I’ll happily share my email if so.
As you will have read in the above article, a law firm called Simpson Millar are urging the govt to back date the stamp duty waiver but I’m not sure if Simpson Millar are planning or considering a judicial review. I have tried emailing Sarah Ryan who heads up the conveyancing dept but didn’t hear back.
Just over a 100 more signatures needed and we’ll get a response to the petition.
Dear all,
Just to follow on from my previous post, if any disappointed house purchasers are still following this thread, please can I encourage you to take your story to Simpson Millar law firm and ask to speak to Sean. Sean is a lawyer there who is gathering individual stories and accounts from aggrieved people who missed out on the stamp duty waiver. They are campaigning hard to try and get it back dated.
I completed on 7th July at 4pm – I wanted to delay as there were rumors of the SD holiday but feared the legal repercussions and sticked with my completion date. 8hrs later and I would have saved 15k.
Personally, I had expected this would have been made effective March as this was a Coronavirus and Rishi Sunak said he is man of “Values”.
The uncertainty of the pandemic began in March, the country went into lock down on March 23, Robert Jenrick proudly announced the re-opening of the housing market on May 13th, asked people to move forward with the purchase and in the end punished them by providing the stamp duty benefit to those who did NOT move until 8th July.
While usually a question may be asked where will you draw the line as there will always be people who miss out. This time however it’s different, we know when the crisis began, we know when the market re-opened, we have logical dates yet the government chose an arbitrary date to inject the life into the market and suck out the life of those who completed prior to the announcement.
I have emailed my MP (Ed Davey), Rishi Sunak and Robert Jenrick – No response so far. I have also signed the petition, its nearly reached 10k.
I was going to hire local professionals to do my bathrooms, toilet, all flooring, plumbing, garden but now after stamp duty not being backdated I will get them from Poland, cost much less and do terrific job. Plus Tory will lose couple of votes I can imagine.