Do I pay stamp duty on a shared-ownership property?

A reader from Bristol is planning to by a shared property through the government's HomeBuy scheme. However, he is unsure whether he will have to pay stamp duty or not.

Tony Davis, myfinances.co.uk mortgage expert from Mortgage Meadow, takes him through the problem.

Mr Sagna asks:

I am buying a property under the share ownership scheme. I'm taking 75 per cent for £112,500 but property is valued at £150,000.
Do we have to pay stamp duty?

Tony replies

In this year's Budget the Chancellor announced that no stamp duty would be charged on New Build Homebuy (Shared Ownership) purchases provided that the individual's initial share was not greater than 80 per cent. Should the individual increase their ownership beyond the 80 per cent threshold later (through staircasing), then stamp duty would be levied on the amount being paid at that time.

A very long way of saying – no, you will not be paying stamp duty.

If you have a question for Tony, go to the myfinances.co.uk Ask the Mortgage Expert section.

Or for more information or mortgage advice go to Mortgage Meadow.

Mortgage Meadow is an independent mortgage broker and is authorised and regulated by the Financial Services Authority.