How much Stamp Duty do I have to pay when I purchase a property in England?
Our conveyancing solicitors in Bideford, Barnstaple, Tiverton, Braunton and South Molton are highly experienced in all aspects of residential property law and will be happy to provide you with a quote. In this article partner Steph Cleak deals with a very common question, ‘How much Stamp Duty do I have to pay?’
Stamp Duty, or to give it its full title, Stamp Duty Land Tax, is a tax payable by the purchaser when buying land or property in England and Northern Ireland. The tax is based on the purchase price. It is important when purchasing a property that you factor in the cost of Stamp Duty to ensure you have enough funds to proceed with your purchase.
The HM Revenues & Customs (‘HMRC’) guidance in this area is complex and evolving but the current thresholds for Stamp Duty on residential property (as at September 2023) are:
| Property or Lease Premium or Transfer Value | Stamp Duty Rate |
| Up to £250,000 | 0% |
| The next £675,000 (the portion from £250,001 to £925,000) | 5% |
| The next £575,000 (the portion from £925,001 to £1.5 million) | 10% |
| The remaining amount (the portion above £1.5 million) | 12% |
The amount of Stamp Duty you will have to pay will depend on a number of factors, such as:-
- Whether the use of land or property is residential, non-residential or mixed-use
The above rates apply only to residential property. If you are purchasing a commercial property, such as a shop or café, different rates will apply.
- Whether you are a first time buyer
If you are a first time buyer you may be eligible for ‘first time buyer relief’ and will not have to pay Stamp Duty on the first £425,000. To qualify you must:-
- Have never purchased property before;
- Have never inherited or been gifted property before;
- Be purchasing for under £625,000; and
- Not be married to someone who owns property. The HMRC have said that where an individual with a spouse or civil partner buys a dwelling, their spouse or civil partner will be treated as a joint buyer even if they are not a party to the legal transaction.
- Whether you are buying additional property
Where you already own at least one residential dwelling you will need to pay an additional 3% of the purchase price, on top of the SDLT rates above.
If you will be replacing your main residence with the property you are purchasing and will complete on the sale of that property on the same day then the additional 3% is not payable.
- Whether you are a UK resident
You will need to pay an additional 2% of the purchase price if you have not been present in the UK for at least 183 days (6 months) during the 12 month lead up to the purchase date.
Stamp Duty must be submitted and paid to HMRC within 14 days of completing on your purchase and as your lawyers we will see to this as part of our standard post-completion work.
Stamp Duty is a self-assessment tax so you need to ensure that the amount being paid is correct.
You should note that if you are purchasing property in Wales then ‘Land Transaction Tax’ rather than Stamp Duty will apply.