If you buy either property or land in the UK you have to pay Stamp Duty Land Tax (SDLT).
Since April 2016 the stamp duty levy on second homes and buy-to lets has changed with a 3% surcharge now payable in addition to the standard rate for such purchases. The full detail can be seen by following this link: https://www.gov.uk/stamp-duty-land-tax
If you are selling your main home, but for a short period will own two properties having purchased your new home whilst still trying to sell your old home, you will still have to pay the 3% surcharge levy on the purchase. This surcharge can be refunded by HMRC provided that your old home sells within 36 months of the new home having been purchased.
The new surcharge arrangements are complicated in places and are subject to change (such as that affecting homes with annexes for example) so if in doubt you can contact any of our offices at any time for further advice.
Stamp Duty Land Tax is charged on all purchases of houses, flats and other land and buildings.
The SDLT rate depends on:
- The purchase price of the property
- Whether the property is residential
- Whether the property is in a disadvantaged area
Stamp Duty Land Tax is normally paid directly to your solicitor with your funds for the purchase of the property.
Stamp Duty Land Tax rates on residential land or property:
|Purchase Price of Property||Rate of SDLT (% of total purchase price)|
|£0 - £125,000||0%|
|£125,001 - £250,000||2%|
|£250,001 - £925,000||5%|
|£925,000 - £1.5 Million||10%|
|Over £1.5 Million||12%|
So if you buy a house for £275,000 you will pay £3,750 in Stamp Duty Land Tax on top of the purchase price.
This is calculated as follows:
0% on the first £125,000 = £0
2% on the next £125,000 = £2,500
5% on the final £25,000 = £1,250
Total Stamp Duty Land Tax payable = £3,750
For more information on how to calculate your Stamp Duty Land Tax, please visit: Stamp Duty Land Tax.