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: