First time buyers can avoid stamp duty, but whether they can drop below the tax-free £ 300,000 threshold depends on where they want to live.
Across the country, six out of ten homes for sale to first-time buyers last year could be exempt from stamp duty, new research shows.
But while first-time buyers at Bootle in Merseyside and Shildon in County Durham would almost certainly find a house for which they would not be charged stamp duty – at a price of 99.6 percent in this category – for those in Buckinghamshire Beaconsfield would only have a chance of one in 50.
The study of the real estate website Zoopla compared houses for sale with the stamp tax threshold for locations in England, Scotland and Wales.
Six out of ten homes for first-time buyers were exempt from stamp duty last year, but in some places like the top ten on this card, new home owners are almost certain they won't pay them
Exempt from stamp duty for first time buyers: This three bed home in Bootle, Merseyside is for sale for £ 165,000
Scotland has the highest percentage of tax-free homes for first-time buyers at 61.4 percent, while Wales had less than England at 56.1 percent at 58.2 percent.
In London, the Croydon district was home to the highest percentage with 26.8 percent.
The stamp duty on property purchases is levied at different rates, which, depending on the value of the home, are above the threshold values. They start at 2 percent between £ 125,001 and £ 250,000 and rise to 12 percent over £ 1.5m.
Stamp tax calculator
This is Money's stamp tax calculator, showing that the bill for a £ 300,000 house is usually £ 5,000.
Find out how much a property purchase would cost you here.
> Stamp tax calculator
However, first-time buyers are currently receiving special conditions to bring them to the property manager.
These thresholds vary depending on whether you are shopping in England, Scotland or Wales for the first time.
Stamp tax thresholds for first time buyers start at £ 300,000 for homes in England, while they start at £ 175,000 in Scotland.
In Wales, all types of buyers – including first time buyers – pay £ 180,000 stamp duty.
The stamp tax relief for first-time buyers under £ 300,000 in England was introduced by former Chancellor Philip Hammond in November 2017 and includes partial relief for properties up to £ 500,000, with the amount up to £ 300,000 exempt from tax.
To qualify, buyers must never have owned or owned a house anywhere in the world, and those who buy from a partner must do so for both buyers.
Overall, 59 percent of the property for sale falls under the property tax threshold for first time buyers across the UK.
|rank||Poststadt||Average October 2019||% Below the FTB SDT threshold||% Above the FTB SDT threshold|
|1 =||Bootle||£ 100,534||99.60%||0.40%|
|1 =||Shildon||£ 84,286||99.60%||0.40%|
|4 =||Blyth||£ 127,087||99.00%||1.00%|
|5 =||Gateshead||£ 139,084||99.00%||1.00%|
|rank||Poststadt||Average October 2019||% Below the FTB control threshold||% Above the FTB control threshold|
|3rd||Chalfont St Giles||£ 1,004,298||3.40%||96.60%|
|5||Thames Ditton||£ 744,210||4.60%||95.40%|
|6||Harp ends||£ 828,402||4.90%||95.10%|
|8th||Virginia water||£ 1,331,011||5.30%||94.70%|
This triple house in Shildon, County Durham is for sale for GBP 199,950. It is therefore exempt from stamp duty for first-time buyers
After Bootle and Shildon in County Durham, where 99.6 percent of the homes for sale to first-time buyers are stamp-free, Heckmondwike in West Yorkshire has the next highest tax-exempt homes with 99.2 percent.
This is followed by Blyth in Northumberland and Gateshead in Tyne and Wear, each with 99 percent.
In contrast, Beaconsfield in Buckinghamshire, at just 1.7 percent, has the smallest number of properties where first-time buyers are exempt from stamp duty.
The village of Ingatestone in Essex is in second place with 2 percent and Chalfont St Giles in Buckinghamshire with 3.4 percent in third place.
Duty free stamp for first time buyers: This two bed apartment in Croydon, Surrey is on the market for GBP 275,000
This four-bed house in Batley, West Yorkshire is on the market for £ 180,000 and is therefore free of stamp duty
In London, Zoopla analyzed the homes for sale in different districts for those below the stamp duty threshold of £ 300,000, while examining the percentage of properties where first time buyers receive a share of stamp duty relief on prices of £ 500,000 or less.
First time buyers who buy homes for more than this amount but less than £ 500,000 not only do not pay stamp duty up to £ 300,000, they are also entitled to only pay tax on the portion between £ 300,001 and £ 500,000 at the standard 5 percent rate .
First and foremost for stamp duty exemption and partial exemption was London's Croydon district, where 26.8 percent of homes have been sold for less than £ 300,000 in the past 12 months.
This rose sharply to 81.7 percent when first-time buyers received some relief.
The London borough of Kensington and Chelsea, home to some of the UK's most expensive addresses, has only 9.2 percent of the properties where first-time buyers have received tax relief.
This studio on London's Earl & # 39; s Court in the Kensington & Chelsea district is exempt from the tax for £ 200,000 and exempt from first-time buyers
Laura Howard of Zoopla said: “The various tax breaks for first-time buyers across the UK have helped ensure that more than 59 percent of homes are firmly in the duty-free stamp zone.
“Buying your first home is usually the most expensive thing you'll ever do. Therefore, the maximum savings of £ 5,000 made possible with this tax relief is welcome – after all, this could cover your survey and legal costs.
& # 39; It is important to remember that the government has a strict definition of the term "first-time buyer". If you – or someone you buy from – previously owned a property or even part of a property in the UK or abroad, you are not eligible for tax relief.
"While first time buyers in Wales are not treated differently in terms of stamp duty, lower house prices mean 56 percent of homes are exempt, which is still a welcome reality."
|district||FTB control threshold||% Below the FTB control threshold||% Above the FTB control threshold|
|Wales||£ 180,000 *||56.10%||43.90%|
|Great Britain||N / A||59.20%||40.80%|
What percentage of first time buyers pays the stamp duty?
First time buyers who buy a house for £ 300,000 or less do not pay stamp duty.
The HMRC does not publish official numbers for first time buyers who pay stamp duty when buying a house over £ 500,000.
The percentage of first-time buyers who buy a house between £ 300,001 and £ 500,000 and pay stamp duty is 22 percent, according to the HMRC.
Stamp duty has different names and thresholds depending on the country, including the land transaction tax in Wales and the land and building transaction tax in Scotland.
Separate tariffs apply to first-time buyers in both England and Scotland, but not in Wales. So Zoopla has applied the threshold that everyone must follow when doing research for Wales.
|rank||district||Average October 2019||% Below the FTB SDT threshold||% Above the FTB SDT threshold||% Partial SDT discount (under £ 500,000)|
|6||Waltham Forest||£ 431,366||14.10%||85.90%||59.60%|
|10th||Tower hamlet||£ 520,439||3.00%||97.00%||46.00%|
|15 =||Merton||£ 612,911||5.60%||94.40%||35.80%|
|15 =||Barnet||£ 636,032||5.70%||94.30%||35.80%|
|22||Hammersmith and Fulham||£ 934,117||1.60%||98.40%||18.50%|
|24th||Richmond upon Thames||£ 850,053||0.70%||99.30%||14.50%|
|25th||Kensington and Chelsea||£ 1,935,105||1.50%||98.50%||9.20%|
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