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Welsh Stamp Duty holiday – but only for home-buyers

The Welsh Government has bowed to pressure to give Welsh house buyers a Stamp Duty holiday from 25 July 2020, says Sean Randall.

All house buyers in the UK will now benefit from a Stamp Duty holiday, designed to inject confidence in the housing market. Buyers in England and Northern Ireland already enjoy a Stamp Duty break on purchases up to £500,000, worth up to £15,000 per property. Buyers in Scotland will enjoy one from tomorrow on purchases up to £250,000, worth up to £2,100 per property. And buyers in Wales will enjoy one from 25 July 2020 on purchases up to £250,000, worth up to £2,450 per property. Although the Welsh and Scottish thresholds are only half the threshold in the rest of the UK, this reflects much lower average house prices in these regions. In both regions, the holiday is expected to mean that Stamp Duty is not payable on 80 per cent of residential property transactions.

This is how the three holidays compare against average house prices:

 

Region
Average house price – 2020
(£)
Stamp Duty during holiday (home buyers)
(£)
Stamp Duty during holiday (second homes / BTLs)
(£)
London
605,437
5,271
23,434
South-East
348,972
0
10,469
South-West
292,500
0
8,775
Midlands
226,000
0
6,780
North
176,980
0
5,309
Scotland
152,121
0
6,084
Wales
187,322
0
5,875

 

Much has been said about the Stamp Duty holiday in England and Northern Ireland, including the fact that it applies to all purchasers: home-buyers and investors/developers/traders. Home-buyers in England and Northern Ireland may feel aggrieved that the tax break gives an edge to landlords, pushing up house prices. This is likely to be the case too for home-buyers in Scotland, though, the draft legislation has not been published yet. But home-buyers in Wales will have some protection. A major distinction with the Welsh Stamp Duty holiday is that it does not apply to purchases of ‘additional’ dwellings by individuals and purchases of dwellings by companies. Presumably, this is also intended to prevent buyers of second-homes in Wales from enjoying the holiday.

Would you like to know more?

If you would like to discuss any of the above guidance or have other queries about how you can make the right decisions for the future of your business and your income, please contact Sean Randall or your usual Blick Rothenberg contact.

For any press queries, please contact David Barzilay whose details are to the right.