If you live in England or Northern Ireland, you will need to pay Stamp Duty on residential, commercial and buy to let properties that cost more than £125,000. This tax also applies to freehold properties as well as leasehold, and still stands whether you are buying a property outright, or if you are purchasing a home with a mortgage. If you live in Scotland or Wales, you will not have to pay the Stamp Dut Tax, however, you will need to the Land and Buildings Transaction Tax (for those living in Scotland) or the Wales Land Transaction Tax. For more information on these services, contact your local government.
Stamp Duty Land Tax Rates
When it comes to paying Stamp Duty Land Tax, you will find that you fall into a rate band. The tax band you are given is decided by how much your property is worth. The tax is only to be paid on houses over £125,000. After this, you will be taxed 2% of the next £125,000, and then 5% on the next £25,000 afterwards. For example, if you pay £125,000 or over for a home, you will need to pay 2% Stamp Duty Tax. If you purchase a house over £250,000, your Stamp Duty Tax Rate will be 5%, and if your home is valued over £925,001, your Stamp Duty Tax will stand at 10%. Anything over £1.5m will be taxed at 12%.
Commercial Property Stamp Duty Rates
If you are buying a property, or area of land, that is non-residential or has a mixed-use, you will still need to pay Stamp Duty Tax. Unlike residential homes, stamp duty tax for Commerical Properties is only paid on those worth £150,000 or more. Properties that fall under this title include shops, offices, forests, abandoned lots, and farmland. To find out how much stamp duty tax you owe, use the government stamp duty tax calculator. Usually, anything over the £150,000 threshold will mean that you have to pay 1% Stamp Duty Tax. On anything over £5m, you will need to pay 2% Stamp Duty Tax.
Buy to Let Stamp Duty Rates
If you’re looking to purchase a home with the intention to rent it out, you will need to pay Stamp Duty. To find out how much Stamp Duty you owe, use the Which calculator. Whether you’re buying a holiday home, buying a second home or buying to let, you will need to pay Stamp Duty. This also stands for residents in Northern Ireland. If you live in Scotland or Wales, you will have to pay tax in other way, guidelines for which can be found on the government website.
Even if you are married, and you personally own no properties, you will still need to pay your stamp duty tax if your partner owns, or has owned, a property in the past. If you are unsure on how much stamp duty you will need to pay on a property, or if you’re unsure whether you are exempt from stamp duty as a first-time buyer, read on below or contact a solicitor for more help and guidance.
Stamp Duty Rates for First Time Buyers
If you’re a First Time Buyer, you will not have to pay any Stamp Duty Tax on your property, if its value is below that of £300,000. This was announced back in 2017 and has been in effect ever since. If you’re a first-time buyer, and the property you are buying is above £300,000, you will be taxed on the amount above this, up until £500,000.
The exemption for First Time Buyers will only apply if you plan on living in the residence that you intend to buy. If you plan on buying a property in order to rent, you will not qualify for the First Time Buyer exemption. Unfortunately, you will also be exempt from this if you have inherited a house, or if you have owned a property share.