How Much You Pay?
The amount of Stamp Duty Land Tax you pay usually depends on whether you buy the property for residential purposes, commercial use (non-residential), or mixed-use.
For buying a residential property, there are different rate bands depending on the cost of property and:
- If you are a first-time buyer
- If you are purchasing an additional property (already own a property)
- Your UK residency status
You can also reduce your stamp duty tax by claiming certain reliefs and allowances that you qualify for.
You can use the HMRC Stamp Duty Land Tax calculator to calculate the tax you will have to pay.
Stamp Duty Tax relief for First-time Buyers
A person qualifies as a first-time buyer if they buy their only or primary residence and have never owned a freehold property or have interest in the leasehold residential property in the UK or outside the UK.
From 1 July 2021, you can claim relief for buying a property and will pay little or no tax if:
- You are a first-time buyer and
- The cost of the property is £500,000 or less
If you buy a property worth over £500,000, you will pay Stamp Duty at the standard rate and won’t qualify as a first-time buyer to get the relief.
SDLT for Non-UK Residents
If you are not present in the UK for a minimum of 183 days (6 months) during the 12 months before you purchase the property, you are considered a non-UK resident for SDLT purposes.
For a non-resident, purchasing a residential property in England and Northern Ireland will cost you an incremental 2% tax along with the existing stamp duty rates depending on the cost of the property.
Higher Rates for Buying New Residential Property
If you buy a new residential property before selling your previous home, you will have to pay an extra 3% on top of SDLT rates because at the time you complete your purchase, you will own two properties.
You will not have to pay the extra stamp duty if you replace your residence that has already been sold. Otherwise, you will have to pay higher rates to buy the property.
However, you can apply for a refund for the amount above average SDLT rates; if you sell your previous primary residence within 36 months (3 years).
If It Takes More than 3 Years to Sell the Previous Residential Property
You can still request a refund if it takes more than three years to sell your old home if all of the following apply:
- You acquired your new home on or after 1 January 2017
- You could not sell the property because of exceptional circumstances, such as a pandemic like Covid-19, etc., government restrictions, or public authority blocking the sale.
- You have now sold out your previous home.