How Much is Stamp Duty in the UK?
Everything you need to know about that tax
Last updated on
Sep 23, 2022 17:32
Stamp Duty Land Tax is a tax on property purchases that you have to pay when buying a new home. Some people, like first-time buyers, don’t have to pay it.
To help you understand what Stamp Duty is, how much you can expect to pay, and whether you’re exempt, we’ve created this guide. And if you’re still unsure about how much stamp duty you’ll need to pay after reading this, you should check with your solicitors.
When buying property in England and Northern Ireland, you need to pay Stamp Duty Land Tax (SDLT) on it. This is a tax on property purchases, sort of like VAT on everyday items.
In Scotland and Wales, it’s called something else (but is the same thing):
In this guide we’ll refer to it as Stamp Duty - its most common name.
The amount will depend on your property price, location, and your situation.
The simplest way to check is with HMRC’s calculator.
Stamp Duty is worked out in bands, applied to different chunks of the property price. Here’s an example of what we mean:
If you buy a property for £300,000, you’ll pay the following:
The total Stamp Duty will be £2,500.
But for first-time buyers, there’s no stamp duty at all up to the £425,000 mark. So, Stamp Duty on a property purchase of £300,000 would come to a grand total of £0.
Stamp Duty has to be paid on any property that costs over £250,000. You pay Stamp Duty when:
Some people can apply for Stamp Duty relief, reducing the amount you need to pay. Some situations where you’ll be eligible for relief include:
There are other reasons you may be exempt, and HMRC keep an updated list here.
You’ll need to pay Stamp Duty within 14 days of completing your purchase.
The responsibility for this is on you: you’ll need to file a return and pay it. But, don’t worry. Your conveyancer or solicitor will often include this in their services. You’ll pay the amount to them, instead of to HMRC. Ask them about this so you’re totally prepared.
First-time buyers won’t need to pay Stamp Duty on properties that cost up to £425,000.
If the home you’re buying costs between £425,001 and £625,000, you’ll pay a 5% Stamp Duty tax on the amount above £425,000.
If the property costs more than £625,000, you’ll pay the regular Stamp Duty rates.
It’s also worth knowing that Stamp Duty relief for first-time buyers doesn’t apply if:
If you’re buying a second home, you’ll pay an extra 3% on top of the standard Stamp Duty rates.
Stamp Duty does apply to buy-to-lets. You’ll pay the standard Stamp Duty rates, plus 3% on top. This also applies if you’re a first-time buyer investing in a buy-to-let property.
Stamp Duty can sound complicated, but in reality, it’s pretty simple. Your conveyancer or solicitor will help you understand how much you’ll need to pay and file the return for you, so it’s a simple process. If you’re a first-time buyer, you may not even need to pay Stamp Duty at all.
To find out if you’re eligible for relief, make sure to check with HMRC’s calculator.
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