The way stamp duty is being calculated on the purchase of residential property changes from midnight tonight. According to the Government, 98% of people will save as a result of the changes:

Stamp duty will be cut for 98% of people who pay it. If you’re buying a home for less than £937,500, you will pay less stamp duty, or the same.

HMRC has produced a very useful 2 page fact sheet which explains the new stamp duty tiers and example amounts payable.

For example, according to the fact sheet, from 4 December 2014, a house costing £275,000 (the cost of an average house) will save £4,500 stamp duty compared to the previous rules.

The new tiers and percentages from 4 December are:

  • £ 0 – 125,000 – 0%
  • £125,001 – 250,000 – 2%
  • £250,001 – 925,000 – 5%
  • £925,001 – 1,500,000 – 10%
  • £1,500,001 and over – 12%