Stamp Duty Land Tax - Update

The New Regime

Chancellor George Osborne said that stamp duty will be cut for 98% of homebuyers in his Autumn Statement to the Commons. These changes came into effect at midnight on the 3^rd December 2014.

Before the Autumn Changes the amount of stamp duty payable jumped at certain price levels. This system has been replaced by a graduated scale which works in a similar way to income tax. Under the old regime, if you were buying at £125,000 you would pay stamp duty at 0% but if you were buying at £125,001 you would have to pay stamp duty at 1% of the whole purchase price, being £1250! Under the new regime you now pay 2% tax on the amount over £125000 mark (until the next tax bracket which comes in at £250,001). So this means that if you buy a house for £130,000, you will now pay stamp duty of £70 rather than £1300!

The new rates are :

Residential properties

Purchase price of property	Rate of SDLT (percentage of portion of purchase price)
£0 – £125,000	0%
£125,001 – £250,000	2%
£250,001 – £925,000	5%
£925,001 – £1.5 million	10%
Over £1.5 million	12%

If you are currently in the process of buying a home here is a link to the stamp duty calculator. www.hmrc.gov.uk/tools/sdlt/land-and-property.htm . You will need to use an estimated date for completion and enter the purchase price of the property that you are hoping to buy.

Swings and Roundabouts

People buying at the more expensive end of the market have seen a considerable rise in stamp duty and this appears to have had an effect on house prices over £2m. Some experts have suggested that this will result in sellers of homes over this value having to reduce their prices by some 10%. A “mansion tax” by stealth?

In our region the changes have already had a positive effect and will hopefully bring first time buyers to the middle market, where they have historically been unable to compete because of the difficulty in finding the large lump sum to cover a deposit and stamp duty.

We can help

Hopefully the changes to stamp duty will see increased activity in the housing market. Here at Hartley & Worstenholme, we have experienced lawyers who are ready to look after both new and valued existing clients. If you would like to discuss the legalities of buying a Property or require an estimate of our costs, then please contact one of the conveyancing team.

Click here to contact either our Pontefract or Castleford office today.

What happens to the house on divorce?

When couples divorce, they sometimes informally agree what will happen to the matrimonial home. They might agree that the wife should live there until the youngest reaches adulthood, that the property be sold and the proceeds be divided (not necessarily equally) or for the outgoing party to be ‘bought out’ by the person who stays. The matrimonial home is often the most valuable asset that a couple own – it is therefore very important that any agreement relating to it is set out with certainty, for both you and your future.

It is essential, when you are in the process of obtaining a divorce, that you carefully consider what you wish to do with your home (and other property you own). If you and your ex-spouse can reach an agreement this can be embodied in a document called a separation agreement or into a document which is then approved by the Court (a ‘Consent Order’). Otherwise, if you cannot agree, the court may make its own order regarding how the property will be divided. Whilst a separation agreement only shows the intention of the parties, either of the types of order may ‘set in stone’ what will happen with your property (and other assets) and should bring an end to any future claims which your ex-spouse may bring against you.

If you are already divorced but, at the time, you did not seek an order, it is possible that your ex-spouse may still be able to claim financial support from you. It is advisable, if you are concerned about this, that you speak to us so that you can be clear on your position. Because of this, when we are approached by clients who wish to ‘buy out’ their ex-spouse or sell the property some years after the divorce, we advise that you seek our advice regarding ‘closing the door’ on future claims.

If you are divorced or divorcing and currently own a property with your former spouse, please do not hesitate to contact our Family Department for further advice and to start the ball rolling. Our Conveyancing Department works closely with the Family Department to ensure a smooth and efficient process.

Voluntary Registration of Land - England & Wales

Over 85% of the land in England and Wales is registered at the Land Registry and the Land Registry has already registered 23 million titles.

If the property you own is not registered at the Land Registry we strongly recommend that you make a voluntary application to register it… why?

Reasons to Register

• It brings your ownership up to date, enables you to identify your holdings, and consolidates and stores relevant information in one place.

• It can identify problems which can be sorted out now. It’s not fair to leave it to your heirs who may not know what you know now, in any case, it’s cheaper to deal with such things sooner rather than later in the long run.

• It provides simpler access to the property details and plans in future. This makes it easier and faster (and so cheaper!) to deal with a sale or other dealing with the property.

• Your ownership is guaranteed by the Land Registry. The loss of unregistered deeds can make it difficult (sometimes impossible) to prove you own your property.

• It makes it harder for people to encroach on your property and successfully claim ownership of the land occupied.

• Buyers and lenders increasingly expect land to be registered before buying or lending.

• Land Registry is currently giving discount on voluntary registration applications. For example if your property is worth between £100,001 and £200,000 the normal fee of £190 is reduced to £140.

Is my property registered?

If we already hold your deeds we’ll be able to tell you.

If you’ve got your deeds you can make an appointment, bring them to see one of our conveyancing team and they’ll be pleased to let you know.

If you’ve access to the internet you may wish to use the Land Registry’s online checker at www.landregistry.gov.uk

How do I do it?

You can do it yourself! You could contact Land Registry and they are there to help.

However, you may find it simpler to let your solicitor (us!) do it for you. We’ll be pleased to do so and will estimate our costs for you at the outset.

For most ordinary domestic property our charge is currently £195 + vat and the applicable Land Registry fee.

If problems arise which would raise those costs we will tell you and seek your approval before proceeding.

Once registered we’ll give you the new title information document and the old deeds to keep.

For further information, please contact us by clicking here.