The new Chancellor Kwasi Kwarteng has today announced a number of new measures that will come into force to help counter the cost of living crisis facing the UK. Changes have also been made to stamp duty - if you’re looking to buy a home the amount of stamp duty you’ll now pay could be significantly lower.

A summary of the changes that have been made:

Stamp Duty

The previous rates of stamp duty for first time buyers was as follows:

0% if your home was worth up to £300,000

5% if your home was worth £300,000 to £500,000 but only on the value above £300,000.

If the property you were buying was worth over £500,000, you would have paid the standard rates of Stamp Duty and wouldn’t have qualified for first-time buyer’s relief.

For everyone else the rates were:

£0 – £125,000 = 0 per cent

£125,001 – £250,000 = 2 per cent

£250,001 – £925,000 = 5 per cent

£925,000 – £1,500,000 = 10 per cent

£1,500,000 and over = 12 per cent

What do the changes mean for you?

For first time buyers:

0% if your home is worth up to £425,000 - previously this was £300,000

If the property you are buying is worth over £625,000, you won’t have to pay the standard rates of Stamp Duty and can still qualify for first-time buyer’s relief - the previous figure was £500,000.

For everyone else:

0% if your home is worth up to £250,000 - previously this was £125,000

Reduction in National Insurance

The previous Chancellor, Rishi Sunak increased national insurance (NI) by 1.25% to help fund social care and the NHS - this came into effect in April 2022. This will now be scrapped from November 2022.

What do the changes mean for you?

If you earn:

£20,000 - there is an annual saving of £93

£30,000 - there is an annual saving of £218

£50,000 - there is an annual saving of £468

£80,000 - there is an annual saving of £843

Income Tax

A 1p drop in income tax which was planned for 2024 has been brought forward to April 2023.

What do the changes mean for you?

If you earn:

£20,000 - there is an annual saving of £74

£30,000 - there is an annual saving of £174

£50,000 - there is an annual saving of £374

£80,000 - there is an annual saving of £674

Energy Bills

Liz Truss has already announced that the energy price cap (the price suppliers can charge for variable rates for gas and electricity) will be capped at £2,500 from October - this was due to be £3,549. Whilst for some households prices will have doubled in a year, this does offer some much needed rest bite.

What do the changes mean for you?

The new price cap will save the average household £1,000 over a 12 month period.

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CreditLadder also runs a free mortgage application service in partnership with Tembo which will tell you how much you could borrow.

Remember the information provided in this article is for information purposes only and should not be considered as advice.