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“How much will stamp duty cost?” is one of the most common questions we receive here at Homeward Legal.

And it’s no wonder, since stamp duty can often be the most expensive part of your conveyancing fees. So, let’s get a little clarity on the subject and find out what stamp duty costs.

What is Stamp Duty Land Tax?

Stamp Duty Land Tax (SDLT) is a tax paid by property buyers in England and Northern Ireland to HMRC that is based on the value of property or land.

Find out more here about what stamp duty costs in 2019.

Wales has its own property tax regime known as the Land Transaction Act (LTT), while Scotland also has a separate system called the Land and Buildings Transaction Act. You can find out what your stamp duty costs will be if you’re buying a home or land in Wales in Homeward Legal’s guide to LTT.

First-time buyers in England have specific exemptions from stamp duty. Get the answers to all  your questions about first-time buyers and stamp duty costs in Homeward Legal’s extensive guide.

Stamp Duty Land Tax is levied on a sliding scale with no tax due on any land and property valued at less than £125,000.

How much does Stamp Duty Land Tax cost?

The rates of Stamp Duty Land tax depend on the value of the land or property you are buying. The amount is paid on a sliding scale, starting from £125,000.

So, if your property is worth less than £125,000, you will have no stamp duty costs at all, though you will still have to fill out a declaration form stating this.

Purchase price of property Stamp Duty cost Buy to Let/Extra Home Rate*
£0 – £125,000 0% 3%
£125,001 – £250,000 2% 5%
£250,001 – £925,000 5% 8%
£925,001 – £1.5 million 10% 13%
£1,500,000.01+ 12% 15%

*Those purchasing a second home or a Buy to Let property must pay a higher amount of Stamp Duty Land Tax.

Can I work out my Stamp Duty costs?

If you know the value of the property you are buying, use the table above to work out the cost of your stamp duty.

There are also a number of Stamp Duty Land Tax calculators online – we recommend this one by Money Advice Service.

For example, if you are buying a house worth £250,000, you only pay tax on the portion above £125,000 – so, in this case, £125,000. And because this is at the lower limit of the SDLT rates, you will pay 2 percent of this amount. That means an overall stamp duty cost of £2,500.

Do I have to pay stamp duty?

Anyone buying a property worth more than £125,000 will have to pay stamp duty. The only exemptions are for first-time buyers in England who do not pay any levy on property up to the value of £300,000. This is known as first-time buyer stamp duty relief.

For properties up to the value of £500,000, first-time buyers will only pay stamp duty on the amount over £300,000.

For properties valued above £500,000, first-time buyers must pay stamp duty at the same rate as other property buyers.

Can I get out of paying stamp duty?

Only first-time buyers get any exemptions from paying stamp duty. Anyone else buying property or land above £125,000 must pay the levy.

When is the bill due?

Stamp Duty Land Tax is due once your property transaction has been completed and you are now the new owner. Your solicitor will generally organise the payment, which is done online to HMRC.

The deadline for payment is 30 days after the purchase transaction has been completed.

Even where you do not own any stamp duty – either because you a first-time buyer or the property’s value is below £125,000 – you need to complete a declaration for HMRC. Your conveyancing solicitor will provide you with a stamp duty return and help you fill it out.

While most solicitors will organise the payment of any outstanding stamp duty, it is your responsibility to ensure it is paid on time.

Expert help a call away

The Homeward Legal team can answer any questions you have about the cost of Stamp Duty Land Tax and when it must be paid. Talk to our team now on 0800 038 6699. We’re open seven days.