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Budget Announcement - Changes to Stamp Duty Land Tax

The Chancellor's Budget announcement includes changes to Stamp Duty Land Tax (SDLT).  The key changes affecting applications for registration in the Keeper’s registers are noted below
From 21 March 2012:

  • A higher rate of SDLT of 15% will apply to purchases of single dwellings over £2 million by certain non-natural persons or bodies of persons (subject to certain exemptions and reliefs, this will include companies, collective investment schemes, unit trusts and partnerships).    Transitional rules will apply to those transactions which would otherwise be within the higher rate but where the contract was completed prior to 21 March 2012
  • The SDLT rules on transfer of rights (sub-sales) will change to exclude the grant or assignment of an option from being a transfer of rights.

From 22 March 2012:

  • A higher rate of SDLT of 7% will apply to purchases of residential property over £2 million, where the 15% rate does not apply.  Transitional provisions will ensure that the old rates will continue to apply in respect of those contracts entered into before 22 March 2012 but which are completed on, or after, that date.  Charities will be able to claim relief from the SDLT charge.

Further details of the changes can be found at:

www.hmrc.gov.uk/budget2012/indirect-tax.htm

These changes were not pre-announced, therefore artl will not calculate the correct amount of SDLT in the above cases. We advise that artl users refrain from submitting applications for Title Transfers affected by these new rates until further notice. An update will be provided in due course, should further information be required in the meantime please contact eServices@ros.gov.uk.

For all other applications for registration, it continues to be the case that a SDLT5 certificate must be submitted in support of an application when the transaction is a notifiable transaction in terms of the Finance Act 2003.

A reminder - First-time buyers' relief

The Finance Act 2010 introduced relief from SDLT for purchases of residential property between £125,000 and £250,000 where one, or all, purchasers are first-time buyers.  This relief is restricted to a two year period which is due to end on 24 March 2012.  The usual thresholds will apply from 25 March 2012.