A Budget for first-time buyers

It was anticipated that the chancellor would announce a SDLT holiday for first-time buyers but he went one step further and abolished it for them. 

Properties costing up to £300,000 will have no SDLT and for most areas in the country that will be sufficient to wipe out SDLT on first purchases. 

This rang alarm bells among many smaller businesses but the chancellor has ducked the issue for now.

But in the more expensive areas for housing the first £300,000 for houses costing up to £500,000 will not be liable to SDLT.

The SDLT saving on a house costing £300,000 is £5,000 which can now be used by the first-time buyer as part of their deposit or towards any expenses they may have. 

VAT

The Office of Tax Simplification carried out a review to look at simplifying VAT and suggested a reduction in the VAT threshold. 

This rang alarm bells among many smaller businesses but the chancellor has ducked the issue for now. 

There will be a consultation on the design of the threshold and in the meantime the threshold will be frozen for two years at £85,000 – it has been increasing by at least inflation each year. 

It is thought that the threshold deters businesses from growing, as the cliff edge for having to register for VAT is too steep.

Sue Moore is technical manager at the Institute of Chartered Accountants in England and Wales