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Stamp Duty

A Guide to Stamp Duty

When purchasing a residential property in England which costs more than £125,000 (£40,000 for a second home) and are not a first-time buyer, you will be liable to pay stamp duty land tax to the government.

Stamp duty costs were altered in December 2014 and now fall into the below bands when buying your main home. The tax is calculated on the part of the property purchase price falling within each band.

Up to £125,000 0%
The portion from
The portion from
The portion from
The portion above

Please be aware that additional residential homes or investments will warrant a further 3% charge on the current rate within each band. This will not be levied if buying a caravan, mobile home or houseboat. Also note that when buying a new main residence, if the sale of your current main home is delayed you will likely be liable for the additional charge but if that previous main home is sold within three years you may be able to obtain a refund on the higher charge portion.

Stamp Duty Exemption

First time buyers are currently exempt (as of November 2017) from stamp duty fees if purchasing under £300,000 (a saving of up to £5000). First time buyers purchasing above that threshold will pay stamp duty on the amount above £300,000. So if purchasing at £400,000, you will pay tax on £100,000 (so £5,000). Any first time purchase over £500,000 will not qualify for any relief. Please note, joint borrowers will only be eligible if both are first time buyers.

First Time Buyers

Stamp duty land tax return is generally paid via your conveyancing solicitor and must be done so within 14 days of completion. Penalties could be applicable outside this time. However, a diligent property solicitor will ensure you have any funds due, in an account very early in the process and will want these funds transferred to them prior to the exchange of contacts.

There are instances when stamp duty is not payable, these are generally confined to transferring a property when divorcing or transferring deeds as a gift or in a will. However, please consult your qualified property conveyancer on these points.


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