Buy A Property Without Paying Stamp Duty!

If you'd prefer not to pay stamp duty when you purchase a new home, there soon may be a way to avoid it.

If you've recently bought a house, you'll no doubt still be feeling the sting of the various costs involved. Solicitor fees, surveys and charges make up a large chunk, as does tax, mainly in the form of stamp duty. At present, depending on the purchase price of the property bought, UK homebuyers must fork out a percentage of its purchase price in duty, on a sliding scale:

Until now, the only way you could avoid this tax is to buy a property costing less than £125,000, or £150,000 if it's in a designated disadvantaged area. However, this is about to change. The Pre-Budget Report on 6 December 2006 included the interesting news that, for a limited period, the vast majority of new zero carbon homes can be bought, free of stamp duty.

So what is a zero carbon home? Well, the Chancellor has yet to elaborate on his definition, but the carbon refers to carbon dioxide, one of a number of gases that acts to trap heat in the atmosphere, causing the so-called greenhouse effect.

Residential property in the UK accounts for nearly a third of the UK's total carbon dioxide emissions, and so tackling this is an important issue. Building new homes with increased insulation which can also generate their own renewable energy will reduce the amount of carbon dioxide they produce. Produce as much energy as they consume and these houses can essentially be called carbon neutral or zero carbon.

The Chancellor continued by stating that his aim is for all newly built homes to be zero carbon within a decade, making us the first country to make this commitment. What's more, anyone currently creating surplus energy in their home will not pay income tax when selling this energy back to the power companies. The Government is expected to reveal a basic outline next week, but for the full details we'll unfortunately have to wait until the Budget next year.

Savings

Clearly, the savings to be made by buying a zero carbon home are huge. Purchase a property costing over £150,000 and you'd save £1,500 and for those buying properties costing over £500,000 could expect to save at least a whopping £20,000 (although it has been hinted at that this exemption may not be available for larger homes).

Unfortunately, the Treasury has admitted that there are currently only 24 zero carbon houses in the UK, situated in the Docklands and Meadows in Nottinghamshire - so don't expect to be able to just rush out and buy one, tomorrow!

Energy Saving in the Home

If you're keen on reducing the carbon dioxide emissions form your home, there are a number of things we can do. Increasing insulation is a big one, especially in the loft as this is where the most of our heat disappears to. Fitting draught excluders and closing curtains when the heating is on will help. Another way to reduce energy consumption is to turn down that thermostat - just one degree can make a huge difference - and don't leave electrical items on standby when you're not using them.

And switching all of those light bulbs to energy saving ones can mean they'll last 12 times longer - and can save you up to £100 on your lighting costs, over the lifetime of the bulb.

Other ways we can tackle our carbon dioxide emissions is to generate our own energy using micro generation technologies. You can buy solar panels in B&Q now, and there are a number of companies that can install a wind turbine or even fit a ground source heat pump for you. Create more energy than you need and, as previously mentioned, you can sell it back to the power companies.

Of course, these methods are very costly to begin with, but they are likely to pay for themselves after a few years. However, those of us that would like to live in a carbon zero home are likely to hope to do so by simply buying one, ready fitted - so the Chancellor's plan should hopefully mean more developers will decide that zero carbon is the way to go!

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