Stamp duty guide

Stamp duty is a government tax on property purchases, payable when you buy a property. There is no ‘stamp’ duty due on the sale of a property. The tax is payable when you buy property or land within England, Wales and Northern Ireland and is officially known as Stamp Duty Land Tax (SDLT).

Stamp duty is due if the property  (or land) exceeds £125,000 for residential properties and £150,000 for non-residential land or property.

How much you have to pay depends on whether your purchase is for residential, non-residential or mixed use property or land. Since the 1st of April 2016, the way stamp duty is calculated has changed. Instead of the rates changing on the entire value as the price increases past certain thresholds, the rates are now calculated a little like income tax, where you pay higher rates only on the amount that you have exceeded the previous level.

Residential stamp duty rates

These rates apply to residential properties of both freehold and leasehold.  Leasehold stamp duty is often referred to as the ‘lease premium’. The rates are as follows:

Stamp duty guide

If you buy a house for £275,000, the SDLT you owe 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 SDLT = £3,750

Multiple properties? The rates have changed

From 1st April 2016, the rates have also changed if you own more than one property. You’ll usually pay 3% on top of the normal SDLT if you already own another property. If you’re replacing your main residence, you won’t pay the extra 3% if the property has already been sold.
However, if there is a delay selling your main residence and it has not been sold on the day that you complete the new purchase, you will also have to pay the higher rates. In some circumstances, you may be able to get a refund if you sell your previous main home within 36 months.

Useful links to government sites:

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