A GUIDE TO STAMP DUTY LAND TAX

STAMP DUTY RATES IN 2023

Last updated: 1st August 2023

When purchasing any property, most will need to consider whether they have to pay ‘Stamp Duty’. Read on to learn what Stamp Duty is, who must pay Stamp Duty charges, the current thresholds and costs, and whether you would have to pay Stamp Duty on a new home at Brabazon.

Stamp Duty Land Tax (SDLT) - often just referred to as Stamp Duty- is a tax charged by the UK Government on the purchase of any property in England and Northern Ireland. It is calculated against the purchase price of the property, so how much you will have to pay in Stamp Duty will depend on the price of the home you are buying.

WHAT IS THE CURRENT STAMP DUTY THRESHOLD FOR HOMES IN ENGLAND?

With the Government announcing increases to the Stamp Duty thresholds in September 2022, homebuyers could save thousands on a new home purchase.

First-time buyers will now pay no Stamp Duty on the first £425,000 of the property price. That means first-time buyers could now purchase a house or apartment at Brabazon without paying any Stamp Duty at all!

For existing homeowners, the threshold has also gone up. Now, you will currently pay no Stamp Duty on the first £250,000 of the property price, which is double the previous tax-free threshold of £125,000.

That means an existing homeowner purchasing a new home at Brabazon, would typically save £2,500 when compared to the rates in place for residential properties between 1 October 2021 and 22 September 2022.

WHAT ARE THE CURRENT STAMP DUTY CHARGES IN ENGLAND?

Stamp Duty rates are charged as a percentage of the purchase price of your new home. The percentage charged increases in bands over the minimum threshold. A top-up rate may also be applicable depending on your personal circumstances.

Explore the Stamp Duty bands for first-time buyers, existing homeowners and investors below. For more examples and special cases or exemptions, please visit GOV.UK.

Stamp Duty Rates for First Time Buyers

If you are a first time buyer, purchasing a home up to the price of £625,000 the following rates apply:

First-time buyers do not benefit from preferential Stamp Duty rates on properties priced over £625,000; the rates for existing homeowners would apply.

Stamp Duty Rates for Existing Homeowners

As a current homeowner, or someone who has previously owned their own home, there is no Stamp Duty Land Tax payable on the first £250,000.

Stamp Duty Rates for Property Investors and Additional Properties

If you are buying an investment property or an additional home, such as a buy-to-let apartment, a second dwelling or a holiday home worth more than £40,000, an additional 3% will apply on top of the standard rates.

You may also have to pay a higher tax rate if you get the keys to your new home before selling your current one. If this is the case, you may be able to apply for a refund on the government website once your home has been sold.

WHO MUST PAY STAMP DUTY?

While Stamp Duty must be paid on all freehold and leasehold properties - new or old, house or apartment - not everyone will have to pay stamp duty. Whether you need to pay or not depends on the purchase price and your personal financial position.

More details on Stamp Duty relief and exemptions can be found on the GOV.UK website.

Information in this article has been prepared for general information only, it is provided in good faith and any figures quoted are indicative based on research as outlined in the sources below.

Whilst efforts have been made to ensure accuracy at the time of publication, YTL Homes are not liable for any inaccuracies.

Source: GOV.UK