New stamp duty rates on property purchases
Effective from 1 January 2021, the States of Jersey have implemented new stamp duty rates on property purchases.
The new rates affect properties purchased for more than £2 million whilst the rates applicable to properties purchased for less than that remain unchanged.
On properties purchased for between £2 million and £3 million, stamp duty will rise from 6.5% to 7%; for properties purchased for between £3 million and £6 million, the rate will rise from 8.5% to 9.5% and from 9.5% to 10.5% on properties purchased for more than £6 million. Bear in mind though that the calculation used is staggered for different price bands so a straight-line calculation using these percentages is not appropriate.
Such changes naturally affect purchasers more so than vendors. Purchasers obviously need to have a clear understanding from the outset as to what their stamp duty liabilities are likely to be.
Vendors also need to consider that purchasers will be of the view that they are in essence paying more for a particular property once the stamp duty is factored into their calculations. Vendors of properties valued around the thresholds are likely to see offers that provide a better stamp duty outcome for the purchaser, given that stamp duty is payable on the price paid and not the valuation of the property.
If you’re seeking advice on a property, please don’t hesitate to get in touch. Together, we can ensure your interests are best looked after.
Call us now on +44 (0)1534 888666 to speak to a member of our Property law team.