What is stamp duty?
Stamp duty land tax is a lump-sum tax that anyone buying a property or land costing more than a set amount has to pay. The rate you'll pay the tax at varies based on the price of the property.
What rate will I have to pay?
As the price you pay for a new property increases, so do the rates of stamp duty. You pay a percentage of the cost, and the rate payable increases at a set of thresholds - but, you only pay the proportion of the purchase price that's actually above the thresholds at the higher rate.
People buying an additional property (ie in addition to any they already own) will be penalised in the form of an extra 5% stamp duty surcharge on any property costing more than £40,000.
Non-UK residents will be charged an extra 2% surcharge on the rates below.
Under stamp duty rules that took effect in 2014 you pay different rates for different proportions of the property price. This will mean that the following additional property stamp duty rates will apply on each portion of the purchase price on buy-to-let and second homes.
What stamp duty will I pay?
|
Purchase price |
Stamp duty rate on first property (1) | Stamp duty rate for additional properties and landlords (2) |
|---|---|---|
| Up to £125,000 (£300,000 for First-Time Buyers) (3) |
0% | 5% (2) |
| £125,001 - £250,000 |
2% | 7% |
| £250,001 - £925,000 |
5% | 10% |
| £925,001 - £1,500,000 |
10% | 15% |
| £1,500,001 + |
12% | 17% |
|
(1) Rate applies to the relevant portion of the purchase price (2) This higher rate / surcharge does not apply if an additional property is bought for less than £40,000. Properties between £40,001 & £250,000 will be charged stamp duty on the full purchase price. (3) First-time buyers won't pay stamp duty on the first £300,000 of a main residential property, provided the property costs £500,000 or less. The £300,000 first-time buyer stamp duty threshold does not apply if the property you are buying costs more than £500,000 – if it does, the £125,000 threshold applies. |
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