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The run up to Christmas isn`t usually associated with an opportunity to save money. Indeed, most people simply resolve to save money in the New Year. However, if you are interested in buying residential Property you could save money by buying before Christmas.

Stamp Duty Land Tax on Residential Property
The temporary increase in the residential SDLT threshold to £175,000 will expire on 1 January 2010. From 1 January 2010, SDLT will be payable on any residential properties worth over £125,000 (unless they are in a disadvantaged area in which case SDLT will be payable on properties worth over £150,000) . To put it bluntly, if you paid £170,000 for a freehold house in December 2009, you would pay no SDLT. If you paid £170,000 for the same house in January 2010, the SDLT bill would be £1,700!

VAT
The temporary VAT rate of 15% is also due to increase back up to 17.5% on 1 January 2010. This will affect a number of costs, including legal costs and the costs of any other goods and services you may want for your new home (for example, a new kitchen/your removal costs). An increase of 2.5% soon adds up when you factor all these goods and services into account.

If you are selling your home, then this VAT increase will affect your costs including your estate agent`s fees, legal costs, moving costs and the money which you pay to your Home Information Pack provider.

What to do next?
Rollits have significant experience in handling residential Conveyancing work from both our Hull and York offices. If you have any queries, then we would suggest that you contact David Prescott in our Hull office on 01482 323 239 or Malcolm Robinson/Alison Munro in our York Office on 01904 625790.

The above tax changes may also be relevant to investors/developers as well as to private residential property purchasers. If you have any queries, please contact Neil Franklin in our Hull office on 01482 323 329 or Douglas Oliver/Alison Munro in our York Office on 01904 625790.

Alison Munro