Buyers of shared ownership properties are now able to claim First Time Buyer Stamp Duty Relief
In last Monday’s budget Philip Hammond announced that First Time Buyer Relief can be claimed on shared ownership properties on the first £300,000 of any property with a purchase price of up to £500,000. Previously, first time buyers of shared ownership properties had to pay full stamp duty land tax (SDLT), even though first time buyers of non-shared ownership properties benefitted from a reduction.
Shared ownership is a scheme under which non-home owners can buy a share in a property (this is often between 25% and 75%), usually from a Housing Association or Local Authority which continues to own the remaining share of the property. The purchaser is then required to pay rent on the share that they do not own.
The SDLT relief is only open to first time buyers (somebody that hasn’t owned a property before, anywhere in the world, which includes gifted and inherited properties) and not to all purchasers of shared ownership properties, who may not own a property at the time of purchase but may have owned a property previously.
If you are buying a shared ownership property and are a first time buyer, but are buying jointly with somebody who has owned property before, you will not be entitled to claim the relief.
This is a retrospective change and dates back to the last budget, which was announced on 22nd November 2017. To claim a refund you need to write to the Stamp Duty Land Tax Office (Stamp Duty Land Tax, HM Revenue and Customs, BX9 1HD). Further information on how to claim can be found here.
Help to Buy
Philip Hammond also announced that the Help to Buy Scheme is to be extended to March 2023 with a new version being launched in March 2021 for first time buyers only, with prices capped regionally.
The caps from March 2021 will be; North East £186,100, North West £224,400, Yorkshire & the Humber £228,100, East Midlands £261,900, West Midlands £255,600, East of England £407,400, London £600,000, South East £437,600, South West £349,000.
It had previously already been agreed that the scheme would be extended to March 2021 but the 2018 budget confirmed the extension for another two years.
The Thompson Smith and Puxon Residential Property team can help with all types of residential property matters, in particular, your purchase, your sale or your remortgage. They can be contacted on 01206 574431 in Colchester or 01255 221919 in Clacton or by email at firstname.lastname@example.org.