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What is Stamp Duty Land Tax?
When you purchase a house,Stamp Duty Land Tax (SDLT) could be one of the major costs that you will need to consider. It’s not always payable on all properties and for all buyers, so here we answer some of the most popular questions regarding stamp duty on the property.
Who pays the Stamp Duty Land Tax?
SDLT is payable on all residential properties over £125,000.00,The cost is the responsibility of the buyer, not the seller, so you need to factor it into your budget when your buying your home. However, there’s no stamp duty for first time buyers on properties up to £300,000.00 so you will be exempt from paying if this applies to you.
Please note that if you are buying a second home,there’s an additional 3% additional property rate on all properties over £40,000.00
Stamp duty Land Tax is payable in England and Northern Ireland.In Wales you pay a Land transaction tax.
How much is SDLT?
Stamp duty rates depend on how much the property you are buying costs, and whether you qualify for relief as a first time buyer.if you want to know how to work out stamp duty, it might be easiest to use a stamp duty calculator.
Do I qualify for SDLT exemption as a first time buyer?
First time buyers don’t have to pay any tax on properties up to £300,000 under certain circumstances.On properties up to £500,000 you pay a 5% charge between £300,001 and the purchase price. If the property costs over£500,000,you will have to pay the standard rates which relate to the total purchase price.
You can claim relief as a first time buyer as long as everyone buying a property has never owned a property either in the Uk or abroad,or inherited a residential property. You must be intending to live in the property you are buying, which has to cost less than £500,000. Unfortunately,there isn’t any SDLT relief for first time buyers in Wales.
This is a guide for 2019/2020 tax year.
Disclaimer: Please note that this article is only a rough guide on Stamp Duty and does not cover SDLT on Shared Ownership or on Buy to let properties. If you require further guidance or information please contact us by clicking here.