The Chancellor, George Osborne, announced in his Autumn Statement this week that the exemption for first time buyers of residential property will end as planned on the 24 March 2012.
Currently first time buyers pay no Stamp Duty Land Tax on residential purchases for £250,000 or less, a saving of up to £2,500.
To qualify as a first time buyer you must not have owned property anywhere in the world and must intend to use the property as your only or main home. Where there is more than one person buying the property, all the buyers must satisfy these requirements.
The Government states that the reason for this decision is that the relief has been ineffective at increasing the number of first time buyers entering the market. The Council of Mortgage Lenders has however commented that whilst that may be true it was a significant help to first time buyers entering the housing market.
It is anticipated that the withdrawal of the exemption on the 24 March 2012 may cause a push by eligible first time buyers to complete their purchases early in the New Year to take the benefit of the exemption.