Stamp Duty Land Tax explained

What is Stamp Duty Land Tax?

When purchasing a property in the UK there are a number of costs you will have to pay. For example: legal costs, mortgage application and compulsory search fees. Not forgetting Stamp Duty Land Tax. (SDLT)

Stamp Duty Land Tax applies to all properties and land registered in the UK. Whether the property is brand new, second hand or derelict. This tax applies to both freehold and leasehold properties – whether you are buying outright or with a mortgage.

Do first time buyers pay Stamp Duty?

If you have just stepped on the property ladder and are purchasing your first home, you may still need to pay Stamp Duty. If the property is under £300,000, you are exempt from Stamp Duty, as the rate is 0%. Over this threshold, properties costing up to £500,000, you will pay no Stamp Duty on the first £300,000. You will pay Stamp Duty on the remaining amount, up to £200,000.

How Stamp Duty is calculated

In the UK and Northern Ireland, rate bands apply for Stamp Duty Land Tax. If the property price is under £125,000 you are eligible for tax relief and will pay 0% tax. After the above property purchase prices, the rates will look like this: –

Purchase Price                                Stamp Duty tax rate

£0 – £125,000                                           0%

£125,000 – £250,000                               2%

£250,000 – £925,000                               5%

£925,000 – £1.5m                                   10%

Over £1.5m                                              12%

The tax is calculated on the part of the property purchase price falling within each band. To calculate how much tax you would pay, please click here

If you are purchasing a residential leasehold property or an additional residential property (second home, buy-to-let) different will rates apply.

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Here at Keelys Solicitors in Lichfield you will find no hidden fees or charges. We proudly offer guaranteed fixed prices. Together with a friendly and fast service from our specialised and dedicated team.

Professional and reliable services at Keelys Solicitors

We have achieved membership of The Law Society’s Conveyancing Quality Scheme. This is the only recognised quality standard for residential property legal work and reflects the high quality and professionalism that we provide to our clients.

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