When buying a home you will have to meet a variety of costs. Amongst the expenses you might expect, such as solicitor’s fees and the fees payable for a mortgage valuation, there is another cost, sometimes overlooked. It is Stamp Duty Land Tax (SDLT).
The Government recently introduced relief for first time buyers purchasing a home on or after 22 November 2017. Click here to find out more
Stamp Duty is a charge levied in England and Wales by the Government and the cost of Stamp Duty is payable by the purchaser. It is a charge levied on all property transactions over certain transactional values.
In recent years Stamp Duty has grown from being a relatively small charge to become a significant tax in its own right. The regulations around it have also become more complex as a result.
Until recently, Stamp Duty on the purchase of property was payable in tiers. Any property purchased for less than £125,000 was effectively exempt. Stamp Duty was also payable on the purchase of residential or commercial property at the same rate. This changed in December 2014.
A purchaser buying property for between £125,000 and £250,000 used to pay 2% Stamp Duty on the total purchase price and anyone that purchased property over £500,000 paid 4% of the total purchase price in Stamp Duty.
The Government recently changed the way Stamp Duty is calculated and for most people buying homes with a value up to £500,000 or so, this is good news. At the time of writing the cost of SDLT is calculated as follows for individuals purchasing Freehold residential property:
You’ll pay:
• nothing on the first £125,000 of the property’s purchase price
• 2% on the next £125,000
• 5% on the next £675,000
• 10% on the next £575,000
• 12% on the rest (above £1.5 million)
If you have exchanged contracts to purchase on or before 3. December 2014 and have yet to complete the purchase there are transitional arrangements. There are also different rules for leases with a value of more than £125,000, corporate bodies, commercial transactions and linked transactions. Instead of SDLT, Land and Buildings Transaction Tax is payable in Scotland. For more details go to www.gov.uk/stamp-duty-land-tax or consult your solicitor.
Download our Free First Time Buyers Guide
Recent posts
The UK government is introducing new rules for Energy Performance Certificates (EPCs) that will impact landlords. Here's a summary of the key changes
Should I buy or rent in 2025?
2 days ago
Choosing to buy a house is one of the biggest decisions you are likely to make in your lifetime. There are many factors that influence a house purchase, these include: finances, housing market conditions, and mortgage rates.
ISAs: what are they, and which one is for me
5 days ago
Since being launched back in 1999 Individual Saving Accounts (ISAs) have been very popular for those wanting to put money into savings. There are four types of ISA, and the majority allow flexible saving and the ability to withdraw funds easily. There are financial penalties on certain products, these usually pay the most interest.
Benefits of buying a new build home
12 days ago
According to the Office for National Statistics, last year (ending March 2024), there were 153,800 new homes completed in the UK. To help the housing crisis, the UK government has pledged to build 1.5 million new homes in the next five years.
Check out some of the reasons why a new-build home might be for you.
Many households are still being affected by the high cost of living, with several people worrying about how they can make ends meet on a monthly-basis. Unfortunately, the cost of bills including, water, council tax, and energy are still rising. Here are some things you can do.
The Renters’ Rights Bill represents a significant milestone designed to enhance the rights and protections of tenants in the rental market. This comprehensive bill aims to foster a more balanced and fair rental sector, ensuring that tenants can enjoy greater security and equitable treatment. It is likely to become law in late 2025.
Limited Company vs Single Name Buy to Let
7 Feb 2025
Owning a buy-to-let property in your sole name versus through a limited company each has its own set of advantages and disadvantages.
Top 10 property price hotspots in 2024
1 Feb 2025
Data from Rightmove shows that Sunbury-on-Thames in Surrey was the number one house price hotspot in 2024. The prices in this area climbed an impressive 12.5% - increasing from an average price of £527,005 in 2023 to £592,926 in 2024.
More information
Trusted by
