Stamp Duty Land Tax – New Regulations

Stamp Duty Land Tax

When you buy property or land in England or Northern Ireland, you have to pay Stamp Duty Land Tax to HMRC. Different rates are charged in Scotland and Wales, and rules apply.

Your solicitor who is in charge of all the legal documentation, will pay HMRC Stamp Duty Land Tax on your behalf. Your solicitor will invoice you for these costs after completion.

For England and Northern Ireland, the threshold on stamp duty for residential properties used to apply to property valued at £125k or higher.

Because of the coronavirus pandemic’s effects on the economy, the government has revised the rules on SDLT. Rates have been reduced for residential properties purchased between 8 July 2020 and 31 March 2021 inclusive.

If you buy or have have bought a residential property, whether you are a first time buyer or not, if the property is valued at less than £500,000, you do not need to pay Stamp Duty Land Tax.

If the property is valued at £500,000 or more, you need to pay SDLT.

Here is the chart taken from Gov.UK’s website to help you calculate your SDLT cost:

Property or lease premium or transfer valueSDLT rate
Up to £500,000Zero
The next £425,000 (the portion from £500,001 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%

If you are planning to buy a residential property and would like assistance understanding SDLT costs, please give us a call. SG

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