Stamp Duty

vicky_elston

I know its speculation, and may not happen... However, we are due to exchange any day and completion was set for the 13th March.
IF the new budget report on the 11th March scraps stamp duty for purchases up to £500k this will benefit us hugely.  If we exchange before the 11th and complete the 13th,  will we have to pay stamp duty?  Alternatively we could exchange the 12th and complete the 13th if our solicitors agreed to it.  My concern also is, that if the stamp duty change is implemented, is there a chance that the new rates wont take effect till the new tax year?? Any advice would be hugely appreciated.  

Catti

Stamp duty is charged on the completion date.  They often bring in transitional rules for any changes, but it would all be speculation at the moment.

davidmcn

Given all the talk of a mansion tax I doubt there are going to be any great giveaways on other property taxes.
However, when there have been SDLT changes in the past there have always been transitional arrangements so that those already stuck in a contract can opt to pay the "old" rates. Leave it later than the budget day and you might not have that option - bear in mind rates might go up!

vicky_elston

Thank you both.  What are the chances of the stamp duty rates going up? Surely this is minimal? 

davidmcn

vicky_elston said:

What are the chances of the stamp duty rates going up? Surely this is minimal? 

Why would it be minimal? The books have to be balanced somehow, we don't know what bizarre spending/taxing plans the government might have. They don't need to bribe the electorate for another few years.

vicky_elston

This is true. I'm just basing it on what I've read.  But, of course they can do what they want however they want to.  I feel like I cant make the right decision!! 

yorkie18

I'm in a similar position. We have exchanged and due to complete on the 12th March. Fingers crossed we get a stamp duty reduction! 

Peony2016

We're in the same position, edging closer to exchange day by day. I'm trying to draw out the process a little by taking my time responding to/asking enquiries and signing contracts but it's not in my nature not to be 'on top' of things so it's frustrating to me to feel in limbo with it all. We're hoping to exchange on 12th March at the earliest. If they raise stamp duty on 11th March we have some additional savings tucked away to pay it, but we'd rather take the gamble on it going down/being scrapped completely under £500k. In previous years the government has allowed people to choose which scheme to apply if they had already exchanged by the date of the announcement, but you can't take that as a given for this government unfortunately. I'd read murmurings that the mansion tax plans had been scrapped, but you can never believe what you read in the papers.
In your situation it very much depends on the other parties in your chain and how eager they are to move. Would anyone else in your chain stand to save money if stamp study under £500k was scrapped? Perhaps a friendly chat to one of them could persuade them to delay so it's not just you pushing for delay?

vicky_elston

Peony2016 said:

We're in the same position, edging closer to exchange day by day. I'm trying to draw out the process a little by taking my time responding to/asking enquiries and signing contracts but it's not in my nature not to be 'on top' of things so it's frustrating to me to feel in limbo with it all. We're hoping to exchange on 12th March at the earliest. If they raise stamp duty on 11th March we have some additional savings tucked away to pay it, but we'd rather take the gamble on it going down/being scrapped completely under £500k. In previous years the government has allowed people to choose which scheme to apply if they had already exchanged by the date of the announcement, but you can't take that as a given for this government unfortunately. I'd read murmurings that the mansion tax plans had been scrapped, but you can never believe what you read in the papers.
In your situation it very much depends on the other parties in your chain and how eager they are to move. Would anyone else in your chain stand to save money if stamp study under £500k was scrapped? Perhaps a friendly chat to one of them could persuade them to delay so it's not just you pushing for delay?

Its first time buyers buying ours so will make no difference to them.  Our Seller hasn't found a house so is moving in with family.  I'm hoping we can exchange on the 12th and complete on the 13th as I don't want to take the risk of delaying it any further as our seller had multiple offers - our offer was accepted based on our house sold first!  If we don't complete the 13th we cant complete till the 3rd April! (my husband is away with work, we have two children and one on the way, my family live the other end of the country, so its not an option doing it without him!)  Its such a horrible situation to be in. Part of me thinks we were prepared to pay it, so just exchange now and complete on the 13th and what will be will be.  The other part of me thinks for it could save us potentially £8k!  Oh if only I had a crystal ball!! 

vicky_elston

yorkie18 said:

I'm in a similar position. We have exchanged and due to complete on the 12th March. Fingers crossed we get a stamp duty reduction! 

I'm holding off exchanging but i have no idea whether this will make any difference! I would assume it based on the completion date from what I've read, but no one seems to know! 

Peony2016

vicky_elston said:
Its first time buyers buying ours so will make no difference to them.  Our Seller hasn't found a house so is moving in with family.  I'm hoping we can exchange on the 12th and complete on the 13th as I don't want to take the risk of delaying it any further as our seller had multiple offers - our offer was accepted based on our house sold first!  If we don't complete the 13th we cant complete till the 3rd April! (my husband is away with work, we have two children and one on the way, my family live the other end of the country, so its not an option doing it without him!)  Its such a horrible situation to be in. Part of me thinks we were prepared to pay it, so just exchange now and complete on the 13th and what will be will be.  The other part of me thinks for it could save us potentially £8k!  Oh if only I had a crystal ball!! 

Have you checked with your solicitor whether you would theoretically be able to complete the day after exchange? Sometimes it's not possible because of the timescales of the bank releasing the money.
I told our solicitor and estate agent right at the beginning that we don't want to complete until at least 12th March but I haven't mentioned it since. My plan is to move things along slowly but not too slow that the other parties in the chain get annoyed and remember why i'm going slow - I don't want them to feel manipulated so i'm not going to mention any dates yet. Is the chain waiting on you for anything that you could move slowly on (signed contracts/enquiries etc)? Unfortunately it just might not be possible to delay if the other 2 parties won't wait. At least you already budgeted for stamp duty if you have to pay it.