Stamp Duty Increases

The average amount of Stamp Duty paid on a home has increased by 24.76%, says Mform.co.uk.

As the purchase price of homes increase then the cost of stamp duty rises. Further research reveals that of those people who have paid Stamp Duty over the past three years, 28% increased their mortgages by on average £3771 to help pay for it.

Figures from mform.co.uk show an increase from £2,870.65 in 2005/06 to £3,581.37 in 2006/07 with London seeing the highest level and Scotland seeing the lowest at £7,942 and £1,585 respectively.

Northern Ireland saw the highest rise but with the average Stamp Duty per property sold rising by 104%, from £1,178.08 to £2309.72.

An extra £3,770 on a mortgage of £150,000 at a 6.24% interest, for example, would increase monthly repayments from £988.58 to £1,013.42. Over 25 years, this would increase the cost by £7,452, which is a significant amount of money.

Stamp Duty Land Tax is paid at a variable rate for properties sold over £125,000. This is charged at 1% for most properties up to £250,000, 3% between £250,001 and £500,000 and 4% above that. The duty is paid on the whole of the purchase price and not just the amount above the cut off. For example a house costing £195,000 would produce a stamp duty bill of £1950 whilst, a property purchased at £650,000 would attract stamp duty of £26,000.

Hanson Wealth have offices in Boldon, Durham, Inverness, Standish and North Berwick. We have a community of independent financial advisers based throughout Scotland, England, Wales and Northern Ireland as well as a variety of services available over the telephone or via the internet. So even if you are not based near to one of our branches, we can still ensure that you will get quality independent financial advice from our IFA team.

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