Stamp Duty: What is it & How Much Will It Cost?
Posted on 29th July 2022 at 14:00
Stamp Duty Land Tax (SDLT) is a tax many people will have to pay on residential homes and land bought for over £125,000 in England or Northern Ireland. Different rules apply in Scotland (Land and Buildings Transaction Tax LBTT) and Wales (Land Transaction Tax (LTT).
Stamp Duty must be paid within 14 days of completion. Your solicitor or conveyancer will support you with this part of the process.
How is Stamp Duty calculated?
|
PROPERTY VALUE |
STAMP DUTY RATE |
|
Up to £125,000 |
0% |
|
£125,001 - £250,000 |
2% |
|
£250,001 - £925,000 |
5% |
|
£925,001 - £1.5 million |
10% |
|
Any portion above £1.5 million |
12% |
For example, if you purchase a home for £300,000, the Stamp Duty would be calculated as follows:
|
First £125,000 |
0% (£0) |
|
Portion from £125,001 to £250,000 |
2% (£2,500) |
|
Portion from £250,000 to £300,000 |
5% (£2,450) |
|
Total Stamp Duty payable |
£4950 |
What about First-Time Buyers?
First-time buyers will not pay Stamp Duty on the first £300,000 of the property purchase price. If it is a joint purchase, both partners must be first-time buyers. To qualify for this tax relief, you must have never previously owned a home in the UK or abroad. This also includes any inherited properties, even if you have never lived in them. There is no tax-relief above £500,000, so Stamp Duty would be calucuated in the usual way.
|
Up to £300,000 |
0% |
|
£300,000 - £500,000 |
5% |
Additional Homes
Stamp Duty is taxed at 3% above the standard rate on additional homes. For example, the first £125,000 would be charged at 3% and so on.
Are there any exemptions?
Stamp Duty is NOT payable on:
mobile homes
caravans
house boats
property left to you in a will
property transferred due to a divorce or separation
property given as a gift.
Speak to one of our advisers now
FCA Disclaimer
According to our research, the content contained in this article is accurate at the time of writing.
Infomation on this website is NOT bespoke advice to its audience as therefore does NOT constitute financial advice.
Readers are encouraged to contact our qualified advisers directly for mortgage and protection advice.
As a mortgage is secured against your home, it may be repossessed if you do not keep up with repayments.
Some types of buy to let mortgages are not regulated by the FCA. Think carefully before securing other debts against your home.
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