First time buyers will benefit from relief on Stamp Duty Land Tax for properties worth up to £500,000 after the threshold was increased in today's Budget.
Speaking in the House of Commons this afternoon (29 October), Chancellor of the Exchequer Philip Hammond said stamp duty relief for first-time buyers would be extended from the current £300,000.
The relief will also be extended to buyers of shared ownership properties, who will now be given stamp duty relief on properties worth up to £500,000 to be applied retrospectively from the previous budget.
Mr Hammond did not move to introduce a stamp duty surcharge on non-residents as had been anticipated but Budget documents revealed a consultation on a 1 per cent surcharge is to be launched in January.
Meanwhile from April 2020 the government will reform lettings relief so that it only applies in circumstances where the owner of the property is in shared occupancy with the tenant.
In September Prime Minister Theresa May promised the Conservative party would introduce a new surcharge to be levied on top of all other stamp duty payable.
Speaking at the time Mrs May said the additional tax charge was a move to "help UK taxpayers buy a property" and the extra funds raised would be used towards services for the homeless.
Stamp duty starts at 3 per cent for homes valued less than £125,000, increasing to 5 per cent for homes worth between £125,000 and £250,000 and 8 per cent for homes worth up to £925,000.
Wales and Scotland have different rules on stamp duty.
Initial concerns noted the test used to define non-residents could leave expats facing the extra charge on their return to the UK, with different tests applying to determine non-residents and those who do not pay tax in the UK.
Commenting after Mrs May's initial announcement, Brian Hill, of advice firm Jones Hill, suggested UK expats returning 'home' may be more likely to rent until they become residents to avoid the stamp duty surcharge.