Stamp Duty Guide
What is stamp duty?
If you're purchasing a property in the UK, you may be liable to pay stamp duty on your purchase (not applicable on a sale). Stamp duty is a tax by the government and is paid on completion of your purchase, normally the day you receive your keys.
How much will I have to pay?
There are several rate bands for Stamp Duty Land Tax and below we have used information from https://www.gov.uk/stamp-duty-land-tax/overview.
The tax is calculated on the part of the property purchase price that falls within each band. The bands are £0, £125,000, £250,000, £925,000 and £1.5m.
The bandings are as follows:
For example, if you buy a house for £275,000, the Stamp Duty Land Tax (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.
What if I already own another property?
Buyers of additional residential properties, such as second homes and buy-to-let properties, will have to pay an extra 3% in Stamp Duty on top of current rates for each band.
This increased rate applies to properties bought for £40,000 or more.
It doesn’t apply to caravans, mobile homes or houseboats.
If you buy a new main residence but there’s a delay in selling your previous main residence, you’ll have to pay the higher Stamp Duty rates as you’ll now own two properties.
You can request a refund for the amount above the normal Stamp Duty rates if:
- You sell your previous main residence within three years, and
- You claim the refund within three months of the sale of your previous main residence, or within 12 months of the filing date of your self-assessment tax return, whichever comes later.