STAMP DUTY LAND TAX

September 2022

From 23rd September 2022 First Time Buyers paying £425,000 or less for a residential property will pay no Stamp Duty Land Tax.  A First Time Buyer is defined as an individual or individuals who have never owned an interest in a residential property in the United Kingdom or anywhere in the World and who intends to occupy the property as their main residence.

The rates for Stamp Duty Land Tax are payable on the portion of the purchase price that falls within the bands as follows:-

Residential Standard Rate

• Up to £250,000 at 0% (SDLT form is required £40001.00 upwards)
• The next £675,000 (the portion from £250,001 to £925,000) at 5%
• The next £575,000 (the portion from £925,001 to £1.5 million) at 10%
• The remaining amount (the portion above £1.5 million) at 12%

Rate for First Time Buyers

• Up to £425,000 at 0% (SDLT form is required £40,0001 upwards)
• The next £200,00 (the portion from £425,001 to £625,000) at 5%
• If the price of over £625,000 you cannot claim the relief

From 1st April 2016 the Government increased Stamp Duty payable for investors, companies or second home owners. The current rates are as follows:-

• Up to £250,000 at 3%
• The next £675,000 (the portion from £250,001 to £925,000) at 8%
• The next £575,000 (the portion from £925,001 to £1.5 million) at 13%
• The remaining amount (the portion above £1.5 million) at 15%

The increased rates do not apply when a residential home is sold and a replacement residential property is purchased in most circumstances.

Non UK Residents

There is a 2% surcharge on residential properties in England and Northern Ireland bought by non-UK residents on or after 1 April 2021.  The 2% surcharge applies on top of all other residential rates of SDLT including the higher rates for additional dwellings.

You are obliged to provide all information requested to enable the SDLT form to be completed. The form must be lodged with the Revenue within 30 days of completion together with payment of any stamp duty due, to avoid incurring penalties. It is open to the Revenue to investigate your transaction for up to 9 months after completion. If the Revenue should select your transaction for investigation, they will contact you direct. You can either deal with the investigation personally or pay a solicitor to do it for you. 

You need to be aware that you must keep all necessary and relevant information regarding your transaction as the Revenue can investigate your tax affairs at any time. Solicitors generally destroy their files after 6 years.  

These notes are for general guidance only and you should obtain specific advice from your nominated solicitor.