For Individuals

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Stamp Duty Land Tax

What is it?

Stamp Duty Land Tax (SDLT) is payable to the government when you obtain an interest in a property or land, which is worth more than £40,000.00. The SDLT is payable when you:

  • Purchase a freehold, leasehold or shared ownership property
  • Transfer land or property in exchange for payment, i.e., if you take on a mortgage or buy a share in a house.

The tax situation is different if the property or land is situated in Scotland or Wales.

How much do I pay?

This will depend on various different factors, some of which are: –

  • Where in the UK the property is situated.
  • The value of the property.
  • If you are purchasing a main home or additional property.
  • Whether you are a first-time buyer or not.
  • If you are a UK resident.

If you are looking to buy a property and would find a rough calculation helpful, there is a useful calculator on GOV.UK which can be found here:

First Time Buyer’s Relief

In 2017, relief from SDLT was introduced for first time buyers, meaning that different rates apply.

The relief currently applies to the purchase of residential property up to £625,000.00, provided the purchaser intends to occupy the property as their only or main residence. There will be no SDLT payable for properties up to £425,000.00 and there will be 5% payable on the portion from £425,001.00 to £625,000.00. You cannot claim relief if the value is over £625,000.00.

You are a first-time buyer if, you have not previously acquired a major interest in a dwelling or an equivalent interest in land situated anywhere in this world, alone or with others, whether this was through previous acquisitions, by inheritance or gift, or by a financial institution on behalf of a person under an alternative finance scheme.

Current Rates for a single/replacement property

The Government altered the SDLT liability within their budget on 23rd September 2022. The current SDLT liability rates for a single property are:

Property/lease premium/transfer value SDLT Rate
Up to £250,000.00 Zero
The next £675,000 (the portion from £250,001 to £925,000) 5%
The next £575,000 (the portion from £925,001 to £1.5 million) 10%
The remaining amount (the portion above £1.5 million) 12%

How much is stamp duty on a second home?

When purchasing a second home or buy to let properties, there is an additional tax to pay.

An extra 3% is payable on top of the normal SDLT rates when buying another residential property.

If you are replacing your main residence which has already been sold or sells simultaneously, then you will not need to pay the extra 3%. If you have not sold your main residence on the day that you complete your new purchase, then you’ll have to pay higher rate (although you may be able to reclaim the difference).

How and when do I pay stamp duty?

The SDLT return is required to be submitted within 14 days of completion of the transaction and following your approval of the same. This will usually be submitted by the Lawyer acting for you in your purchase and they will collect the SDLT payment from you prior to completion to make payment to HMRC on submission of the SDLT. It is however your responsibility to ensure that the return is made with accurate information and payment made promptly, to avoid any penalty, which is why this is dealt with prior to completion, to avoid any delays.

Reclaiming Stamp Duty

You can make an application for a refund of the additional higher rate if you have sold your previous property within 3 years of purchasing the second residence. The request for a refund must be made within 3 months of the sale of the previous property or within 12 months of the submission of the return for the purchase property. You will however only be able to reclaim the difference between the standard SDLT due and the higher rates applied.

To re-claim Stamp Duty, you need to complete an online form via HMRC’s website. A unique transaction number is required, and this can be obtained from the SDLT 5 Certificate for the additional purchase.