Beat the Forgotten Stamp Duty Increase (it’s coming…)

So, what might we see that will affect the world of property?

Probably, Capital Gains Tax increases; that now feels like a given. Most likely too, Inheritance Tax increases; quite possibly, a reversal of the First-Time Buyer exemption Stamp Duty threshold, which had been previously increased from £300,000 to £425,000.

It is noisy, certainly, and so perhaps it is this distraction which has led people to forget that, unless there is a change in policy, we are due to see an increase in Stamp Duty that will affect all buyers… or at least, almost all buyers. Unless anything changes, that is due to come into force on April 1^st, 2025.

Currently, Stamp Duty is due on the value paid on properties in excess of £250,000, levied as follows: 5% of the amount paid between £250,000 and £925,000, plus 10% of any value paid between ££925,000 and £1,500,000, plus 12% of any amount paid above that figure. Plus of course, there is a further 3% Stamp Duty levy on the whole amount paid if the buyer is buying a second home or a buy-to-let investment (outside of it being a company purchase… but let us not overcomplicate things).

The thing is, there had been another Stamp Duty band in the mix previously, with a liability to pay 2% of the value paid between £125,000 and £250,000. This was temporarily removed for purchases made between 23 September 2022 and 31 March 2025 – but it was written into legislation as a temporary measure only, which means – as mentioned – that without further legislating, this band will return on April 1^st next year.

The average property price in Wiltshire, according to data taken from the Office for National Statistics, is currently £335,000 (as of August 2024), with the average first time purchase in Wiltshire being £267,000. First Time Buyers in Wiltshire therefore, on average, do not pay any Stamp Duty now, and will not pay even if the exemption threshold does come down from £425,000 to £300,000.

Average Wiltshire purchasers however do currently pay on average £4,250 (5% of the value between £250,000 and £335,000). It means that the average Stamp Duty paid on Wiltshire property sales is set to rise to £6,750 after March 31.

Not just that, but in fact across Wiltshire, despite whatever the average property price is, around a third of property purchases are made at less than £250,000. Now, currently, those buyers do not pay any Stamp Duty at all, but from April 1^st next year it is going to be something that any non-first-time buyer will have to be taking into account, bar the very, very few that do buy at less than £125,000.

In England, the average time it takes for a property transaction to go through the conveyancing process stands at 19 weeks.

That means – on average – a buyer would need to have negotiated a purchase prior to November 18^th (four weeks’ time) in order to avoid paying extra stamp duty, unless you are a first-time buyer or one of the 3% of buyers purchasing in Wiltshire at sub-£125,000.

In other words – if you are looking to buy a property in Wiltshire and want to avoid paying more stamp duty than you need to, let’s get talking ASAP.