- You will have to pay Stamp Duty Land Tax if you buy property over a certain price.
- The current threshold is £125,000.00.
- The rate of stamp duty payable depends on the purchase price. The rate of stamp duty starts at 2% and increases incrementally with the purchase price.
- You start to pay stamp duty on purchase money above £125,000.00. For example, if you purchase a property for £135,000.00, you will pay stamp duty on the £10,000.00 over £125,000.00.
- There are two exceptions to this rule:
- First Time Buyers
- Additional Property Owners
- First Time Buyers: individuals purchasing their first home do not have to pay stamp duty if the purchase price is below £500,000.00. To qualify for this relief, purchasers cannot own any property in the world and/or be named on any title deeds anywhere in the world.
- Additional Property Owners: if you are purchasing a property and you will own two or more properties after completion, you will have to pay Stamp Duty as stated above together with the Higher Rate of Stamp Duty. The main exception to this rule is if you are replacing your main residence. Your previous main residence must be sold on or before the completion date of your new main residence.
- Stamp Duty must be paid by you within 14 days of completion.
- If the Stamp Duty is not paid on time, HMRC will charge you a £100.00 penalty and interest will be payable on the tax amount.
If you have any queries in relation to the above, our Property Team will be happy to help.