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Stamp Duty Tax

What Stamp Duty Tax will I have to pay?

Calculate

Results

Stamp duty to pay
Effective rate
Tax Band
%
Taxable Sum
Tax

£0 – £125,000

£0 – £125k

£125,000 – £250,000

£125k – £250k

£250,000 – £925,000

£250k – £925k

£925,000 – £1,500,000

£925k – £1.5m

£1,500,000+

£1.5mill+

What is Stamp Duty tax?

Stamp Duty Land Tax (SDLT) is a progressive tax paid when purchasing a freehold, leasehold or shared ownership residential property over £125,000 in England, Northern Ireland and Wales (separate Land and Buildings Transaction Tax in Scotland).

What changes happened to the UK Stamp Duty in April 2016?

Since April 2016, Buy-to-let landlords and those buying second homes in England and Wales have to pay a 3% surcharge on each stamp duty band.

Below is a table showing what the tax percentages for those buying first homes in the middle column, and the April 2016 3% increase for Buy-to-let landlords and people those second homes in the column on the right.

Stamp Duty Tax Rates as of April 2016
Tax Band
Standard rate
Buy-to-let/
Second home rate

£0 – £125,000

£0 – £125k

0% 3%

£125,000 – £250,000

£125k – £250k

2% 5%

£250,000 – £925,000

£250k – £925k

5% 8%

£925,000 – £1,500,000

£925k – £1.5m

10% 13%

£1,500,000+

£1.5mill+

12% 15%

 

Can I see some examples of how to calculate my stamp duty?

  • If you bought a property (as a second home) for £1,000,000 you would you pay 3% on the first £125,000 (3,750), then 5% of the next £125,000 (6,250), then 8% of the next £675,000 (54,000), and finally 13% of £75,000 (9,750)(Only 13% of £75,000 because you have already calculated £925,000 in the other tax bands).

    £3750 + £6250 + £54,000 + £9,750 = £73,750 in stamp duty for a £1m 2nd home (Effectively 7.4% of £1,000,000).

  • If you bought a property (as a first home) for £60,000, you would pay £0 in tax duty (0% of £60,000).
  • If you bought a property (as a second home) for £60,000, you would pay £1,800 (3% of £60,000).

Can I reduce Stamp Duty?

As stamp duty is only payable on the land purchase, removable fixtures and fittings, or chattels, such as freestanding wardrobes, sofas, fridges, carpets and curtains, are not subject to SDLT and can, therefore, be subtracted from from the total property price. Everything ‘attached’ to property such as light switches technically form part of the property and are subject to SDLT.

If a seller is willing to leave certain chattels, you should agree to pay a reasonable amount between yourself and the vendor and subtract it from the agreed purchase price. This can be executed by a good tax lawyer or conveyancer.

When is Stamp Duty paid?

You must pay stamp duty to the HMRC 30 days from the date of completion or you may risk a fine. Your solicitor or legal adviser should take care of this for you and ensure you don’t miss the deadline. Some buyers prefer to add on the SDLT amount to their mortgage loan. Ask your mortgage provider for further details.

Mortgage providers

Love Your Postcode is dedicated to negotiating the most attractive mortgage finance terms for clients from its established network of lenders, often securing terms unavailable elsewhere. Feel free to call us on 0121 544 9595 and enquire about having a chat with one of our in branch mortgage advisors.