Stamp Duty Rates

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Stamp Taxes on Property

Due to the complex nature of stamp duty and tax planning this information is offered as a guide only and professional advice should be taken before taking any action. Stamp Duty on the purchase or transfer or shares and securities at a value over £1,000 is calculated at 0.5%, rounded up to the nearest £5.
 

Stamp Duty Land Tax (SDLT)

Residential Property 

From 4th December 2014 onwards

transfer of property are subject to stamp duty land tax on the portion of the purchase price that falls into each of the following rate brands:
Value up to £125,000*Nil
£125,001 to £250,0002%
£250,001 to £925,0005%
£925,001 to £1,500,00010%
Over £1,500,00012%

*The limit for residential property in disadvantaged area is £150,000. Special rules apply for new zero-carbon homes. A 15% rate applies to properties over £500,000 purchased by certain “non-natural persons”.

Where contracts were exchanged on or before 3 December 2014, and the transaction is completed on 4 December or later, you can choose whether you follow the new or the old rules.

As a temporary measure due to Covid 19 the primary SDLT rates in England and Northern Ireland for residential property purchases are as follows for transactions completed between 8 July 2020 and 30 June 2021. 

transfer of property are subject to stamp duty land tax on the portion of the purchase price that falls into each of the following rate brands:
Value up to £500,000*Nil
£500,001 to £925,0005%
£925,001 to £1,500,00010%
Over £1,500,00012%

From 1 July to 30 September 2021 the rates will be as follows:

transfer of property are subject to stamp duty land tax on the portion of the purchase price that falls into each of the following rate brands:
Value up to £250,000*Nil
£250,001 to £925,0005%
£925,001 to £1,500,00010%
Over £1,500,00012%

For completions from 1 October 2021 onwards, the SDLT exemptions will not apply.

Where the residential property is being acquired as a second home, a buy to let property or by a property investment company the additional 3% charge applies as set out below in this section.

 

First Time Buyers* 

From 22nd November 2017 onwards

transfer of property are subject to stamp duty land tax on the portion of the purchase price that falls into each of the following rate brands:
Value up to £300,000*Nil
£300,001 to £500,0005%
Over £500,000Standard rates apply

*A first time buyer is defined as an individual or individuals who have never owned an interest in a residential property in the United Kingdom or anywhere else in the world and who intends to occupy the property as their main residence.

Non-Residential Property

Up to and including 16th March 2016

transfer of property are subject to stamp duty land tax at the following rates
Value up to £150,000Nil
£150,001 to £250,0001%
£250,001 to £500,0003%
Over £500,0004%

From 17th March 2016 onwards

transfer of property are subject to stamp duty land tax on the portion of the purchase price that falls into each of the following rate brands:
Value up to £150,000Nil
£150,001 to £250,0002%
Over £250,0005%

Lease Rentals 

SDLT is charged according to the Net Present Value (NPV) of all the rental payments over the term of the lease, with a single rate of 1% on non-residential NPVs over £125,000 and on non-residential NPVs over £150,000. From 17th March 2016, there is a new 2% rate for high value leases with NPVs over £5m.

VAT is excluded from treatment as consideration provided the landlord has not opted to charge VAT by the time the lease is granted.

Lease Premiums 

SDLT on premiums is the same as for transfers of land (except that the zero rate does not apply where rent of over £1,000 annually is also payable).

But to Let/Additional Residential Properties
Purchases before 1st April 2016

Where Buy to Let properties or additional residential properties are purchased before 1 April 2016, SDLT is charged at the same rates as Residential Property above.

Purchases on or after 1st April 2016

Additional SDLT rates have been introduced on Buy to Let or additional residential properties purchased on or after 1 April 2016. The full list of rates is as follows:

transfer of property are subject to stamp duty land tax on the portion of the purchase price that falls into each of the following rate brands:
£0* - £125,0003%
£125,000 - £250,0005%
£250,001 to £925,0008%
£925,001 to £1,500,00013%
Over £1,500,00015%

*Transactions under £40,000 are charged at 0%. This does not mean that the first £40,000 is taxable at 0%. If the purchases price is £45,000 the full £45,000 is charged 3% stamp duty land tax.

Please note from 22 November 2017 relief from the additional rate can be claimed in the following circumstances:

  •  A court order issued on a divorce or dissolution of a civil partnership prevents someone from disposing of their interest in a main residence.
  •  A spouse buys property from their spouse
  •  A person buys a property in a child’s name or on a child’s behalf, where they are doing so in their capacity as the deputy of that child.
  •  A purchaser adds to their interest in their main residence.   

Welsh SDLT

The above rates applied to Wales until SDLT was devolved to Wales on 1 April 2018.

Wales – Land Transactions Tax (LTT) 

LTT main residential tax rates – freehold transactions

When you buy a residential property the following rates will apply to the portion of the price you pay in each brand.

Price Threshold:Rate
The portion up to and including £180,0000%
The portion over £180,000 up to and including £250,0003.5%
The portion over £250,000 up to and including £400,000 5%
The portion over £400,000 up to and including £750,0007.5%
The portion over £750,000 up to and including £1,500,00010%
The portion over £1,500,00012%

When you buy a residential property and you already own one or more residential properties you may need to pay the higher residential rates. However, if you are replacing your main residence the  higher rates may not apply. When companies buy residential properties they will have to pay the residential higher rates and when trusts buy residential properties they may have to pay the residential higher rates. The LTT higher rates are 3% on top of the main residential rates.

LTT main non-residential tax rates – freehold transactions

When you buy a non-residential property the following rates will apply to the portion of the price you pay in each band.  

Price threshold:rate
The portion up to and including £150,0000%
The portion over £150,000 up to and including £250,0001%
The portion over £250,000 up to and including £1,000,0005%
The portion over £1,000,0006%

LTT leasehold transactions 

When you buy a non-residential leasehold property you may be required to pay LTT on the purchase price of a newly granted lease(the ‘lease premium’) using the rates above. However, if you also pay rent on the grant of a lease, rules may apply that remove the )% threshold. The rent over the term of a newly granted lease may be liable to LTT and is calculated on its net present value (NPV).

NPV Threshold:rate
The portion up to and including £150,0000%
The portion over £150,000 up to and including £2,000,0001%
The portion over £2,000,0002%

Land and Building Transaction Tax (LBTT)

 On 1 April 2015, SDLT in Scotland was replaced by Land and Buildings Transaction Tax (LBTT). LBTT is charged at different rates depending on the portion of the purchase price that falls into each of the following rate bands:

Residential Conveyances

First time buyers are entitled to LBTT relief up to £175,000.

Value up to £145,000Nil
£145,001 to £250,0002%
£250,001 to £325,0005%
£325,001 to £750,00010%
Over £750,00012%

Non-Residential Property

Proposed addition of new 2% band from 7 February 2020.

Value up to £150,000Nil
£150,001 to £2,000,0001%
Over £2,000,0002%

Lease Residential for Residential Property

These are exempt from LBTT unless they are for longer than 175 years.

Lease Rentals for Non-Residential Property 

Duty is charged according to the NPV of all the rental payments over the term of the lease, with a single rate of 1% on non-residential NPVs over £150,000.

Lease Premiums

LBTT on premiums is the same as for transfers of land (except that the zero rate does not apply where rent over £1,000 annually is also payable).

Buy to Let

Purchases before 1st April 2016

Where Buy to Let properties or additional residential properties are purchased before 1 April 2016, LBTT is charged at the same rates as Residential Property above.

 Purchases on or after 1st April 2016

Additional LBTT rates have been introduced on Buy to Let or additional residential properties purchased on or after 1 April 2016. The full list of rates is as follows:

transfer of property are subject to land and buildings transaction tax on the portion of the purchase price that falls into each of the following rate brands:Rate
Up to £40,000Nil
£40,001 - £145,0004%
£145,001 - £250,0006%
£250,001 - £325,0009%
£325,001 - £750,00014%
Over £750,00016%

*Transactions under £40,000 are charged at 0%. This does not mean that the first £40,000 is taxable at 0%. If the purchase price is £45,000, the full £45,000 is charged 3% LBTT (4%  for transactions entered into from 12th December 2018).

Disclaimer : This website and its contents have been produced as a helpful reference point. The information should be used as a guide only and your specific circumstances are best discussed directly with us.

 

No reliance should be placed on this material and no action should be taken without seeking the appropriate professional or legal advice. Although the
authors make reasonable efforts to ensure the content of this website is accurate and up-to-date, the authors make no representations, warranties or
guarantees that the content is accurate, complete or up-to-date and accept no responsibility whatsoever for any loss occasioned by anyone acting on information without this website.

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