THE wholesale revision of the Stamp Duty Land Tax will bring a welcome fillip to many properties in the Basingstoke area – and boost the finances of those who aspire to buy them.

Under the new scheme announced by George Osborne in his Autumn Statement, the old system of hard and fast increments in the tax levels have been abolished and the new, much wider spread of tax bands also brings a system where tax is charged by percentage according to how much of the purchase price is within each tax band.

Below £125,000 there is still no duty to pay while between £125,000 and £250,000 the levy is two percent of the difference between the two tax points.

On a £250,000 house the amount paid will stay the same at £2,500. But the heavy losers under the old scheme, those who bought above the previous £250,000 threshold and saw an immediate three percent levy on the whole purchase price will be big winners.

Simon Randall, of Carter Jonas in Basingstoke, said: “Mr Osborne pointed out that on a £275,000 purchase the new Stamp Duty amount will be reduced by £4,500.

“Buyers moving from their first home were frequently seeking to purchase at or above £275,000 and were particularly hard hit when it came to finding the extra tax.

“For that reason, house values between £250,000 and £300,000 were artificially held back under the old regime, meaning their owners could not reap the benefits of their investment because potential buyers were unwilling to pay the extra tax.

“Under the new regime, not until a purchase price of £937,000 will buyers find their tax bill increasing although even beyond that anomalies in the system mean the rates may be lower for some.

“Importantly, Mr Osborne also made arrangements for those who have already exchanged contracts but not yet completed their purchase to work under the old or new Stamp Duty regime, depending on which system was most beneficial. This should prevent some deals collapsing as disappointed buyers with a changed tax bill decided to withdraw.”

The new tax bands are: zero per cent up to £125,000 purchase price; two per cent up to £250,000; five per cent up to £925,000; ten per cent up to £1.5 million; and 12 per cent for anything beyond £1.5 million.

The system keeps the rate assigned to each band applicable for that part of the purchase price.

For instance, on a £400,000 house, the first £125,000 would have no tax levied, the next £125,000 would be levied at two per cent; and the difference between £250,000 and £400,000 at five per cent. The tax bill would be £8,750 under the new system, £12,000 under the old.

An explanatory PDF can be downloaded at https://www.gov.uk/government/publications/stamp-duty-reforms-factsheet and this includes access to an HMRC calculator.