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A guide to stamp duty when purchasing a property

When buying a house there are extra costs in addition to the deposit and mortgage that you may not be aware of.

One of these extra costs is stamp duty, which can cost thousands of pounds. Stamp Duty Land Tax (SDLT) is a personal tax paid on the transfer of land in England, Wales and Northern Ireland.

It is payable on residential properties over £125,000; and non-residential land and properties over £150,000. If you are buying a second home or buy-to-let, you will pay a higher rate of stamp duty on any property over £40,000.

How much is stamp duty?

Stamp Duty is assessed on a tiered basis:
  • Less than £125k      0%
  • £125k - £250k          2%
  • £250k - £925k          5%
  • £925k - £1.5m        10%
  • Over £1.5m            12%
On second homes and buy-to-let the rates are currently:
  • £40 to £125k            3%
  • £125k - £250k          5%
  • £250k - £925k          8%
  • £925k - £1.5m        13%
  • Over £1.5m            15%
GOV.UK website has a handy stamp duty calculator

Your conveyancer should discuss stamp duty land tax with you and if your circumstances are particularly complex you may wish to consult a specialist tax advisor.

In Scotland Land and Buildings Transaction Tax is payable. Ownership of a second property also adds an additional 3% to the tax. However, there is no minimum amount when it comes to second properties, unlike elsewhere with the £40,000 minimum. 

How and when you pay stamp duty

Once you have completed the purchase of your property you have 30 days to complete an SDLT return for HMRC and pay the tax. Your conveyancer will deal with this for you to save you the added stress. This will be done on the day of completion and the amount payable will be included in your conveyancer’s completion statement to you. 



Note: First4Lawyers offers this information as guidance, not advice. Before taking any action, you should seek professional assistance tailored to your personal circumstances and not rely on First4Lawyers’ information alone.
* All details and pricing are correct at time of last update. First4Lawyers and their partners are not tax advisors and we recommend you seek appropriate independent financial advice before making any decisions that relate to tax and property.

 Last updated: November 2017