What is Stamp Duty?
Stamp Duty Land Tax (SDLT) is a tax on properties bought in England and Northern Ireland. SDLT is applied on any residential property purchase over £125,000 and is a legal requirement. You can use this calculator to discover how much Stamp Duty you’ll pay on your new property, although it’s important to consider that this is in general interest and does not constitute financial advice.
Our Stamp Duty Calculator also gives rates on any second property, taking into account the new changes when buying an additional property that costs more than £40,000.
Stamp Duty 2020 Rates for Buy-to-Let and Second Homes
In April 2016, it was announced property buyers would pay an additional 3% on each stamp duty band for second homes or properties bought for Buy-to-Let purposes. Below you’ll find the 2020 stamp duty rates.
Reduced rates of Stamp Duty Land Tax (SDLT) for second homes
|Purchase Price||SDLT Rate*||Additional Property Rate|
|Up to £500,000||0%||3%|
|£500,001 to £925,000||5%||8%|
|£925,001 to £1,500,000||10%||13%|
|Amounts in excess of £1.5 million||12%||15%|
|Band||Normal Rate||Additional Property|
|* An additional property purchased for less than £40k will attract 0% tax.
For purchases from £40k to £125k the rate will be 3% on full purchase price.
|less than £125k||0%||3%*|
|£125k to £250k||2%||5%|
|£250k to £925k||5%||8%|
|£925k to £1.5m||10%||13%|
|rest over £1.5m||12%||15%|
(1) Rate applies to that portion of the purchase price. (2) Properties up to £40,000 are exempt from stamp duty. Properties between £40,000.01 & £125,000 will be charged stamp duty on the full purchase price.
How do I pay stamp duty?
In reality, your solicitor or legal advisor will probably take care of this for you, ensuring that everything is paid on time. Some buyers will also add the SDLT to their mortgage loan, which requires speaking to your provider.
When do I pay stamp duty?
You have 30 days to pay Stamp Duty Land Tax from the date of completion or you risk a fine. Remember, legally, it’s your responsibility to ensure the stamp duty is paid on time. Always maintain your due diligence and ensure it’s being taken care of immediately after completion.
Potential Stamp Duty Changes for Overseas Buyers
The Government announced at the end of October that there will be a consultation on introducing an SDLT surcharge increase of 1% for overseas buyers looking to purchase residential property in England and Northern Ireland. If this was to come into effect, overseas buyers would pay an extra 1% on top of the existing stamp duty charge on second homes and buy-to-let purchases.
This consultation on SDLT is planned to begin in January 2019.
Can I Reduce Stamp Duty Land Tax?
It is a criminal offence to evade stamp duty or to conspire to evade stamp duty. As stamp duty is only payable on the land purchase, removable fixtures and fittings such as wardrobes, sofas, fridges and carpets are not subject to SDLT and can be subtracted from the total property prices.
You’re exempt from SDLT if:
You’re a first-time buyer purchasing a residential property for £500,000 or less, as long as its occupied as the main residence. This SDLT relief is also extended to first-time buyers purchasing through approved shared ownership schemes, who pay SDLT in stages.
No money or payment changes hands for a land or property transfer
Property is left to you in a will
Property is transferred because of divorce or the dissolution of a civil partnership
You buy a freehold property for less than £40,000
You buy a new or assigned lease of fewer than 7 years, as long as the amount you pay is less than the residential or non-residential SDLT threshold