In the UK, stamp duty is applied to house sales. Until midnight yesterday it was applied in bands based on the value of the house where the highest rate was applied on the whole value of the house. The led to some apparently unfair situations.
If I bought a house for £249.999.99 then the rate of stamp duty is 1% and I would pay £2,500 stamp duty
If I bought a house for £250,000.00 then the rate of stamp duty is 3% and I would pay £7,500 stamp duty
A single extra penny on the purchase price of the house resulted in an additional £5,000 tax to be paid.
In principle I didn't have a problem with stamp duty but I felt that it was implemented very badly. In the Autumn Statement, the Chancellor of the Exchequer proposed a change where the rates are higher but they only apply to the marginal value over the higher threshold. This seems fairer to me and whilst I'm sure there can be debate about both the thresholds and the rates I now think that the underling approach is sound.
George Osborne did a good thing (there, I said it :p) and I hope this helps to address some anomalies in the housing market. I'm less happy about the rest of the Autumn Statement but that's off topic and if I can be bothered I'll start a thread on it.
If I bought a house for £249.999.99 then the rate of stamp duty is 1% and I would pay £2,500 stamp duty
If I bought a house for £250,000.00 then the rate of stamp duty is 3% and I would pay £7,500 stamp duty
A single extra penny on the purchase price of the house resulted in an additional £5,000 tax to be paid.
In principle I didn't have a problem with stamp duty but I felt that it was implemented very badly. In the Autumn Statement, the Chancellor of the Exchequer proposed a change where the rates are higher but they only apply to the marginal value over the higher threshold. This seems fairer to me and whilst I'm sure there can be debate about both the thresholds and the rates I now think that the underling approach is sound.
George Osborne did a good thing (there, I said it :p) and I hope this helps to address some anomalies in the housing market. I'm less happy about the rest of the Autumn Statement but that's off topic and if I can be bothered I'll start a thread on it.
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