Stamp Duty Land Tax Explained

Posted on Friday, 21 December 2018 | Written by Hayward Moon

Here at Hayward Moon, we are breaking down the enormity of Stamp Duty Land Tax (SDLT). Stamp Duty is a tax that is applied when buying a property in England and Northern Ireland. If you’re purchasing a property in Scotland Land and Buildings Transaction Tax (LBTT) is what you will pay. If you're buying in Wales Land Transaction Tax (LTT) replaces our Stamp Duty.

The breakdown of Stamp Duty for England and Northern Ireland is as follows:

Band 1 - 0% Stamp Duty on any property that is £125,000 and below.
Band 2 - 2% Stamp Duty on any property that is £125,001 - £250,000.
Band 3 - 5% Stamp Duty on any property that is £250,001 - £950,000.
Band 3 - 10% Stamp Duty on any property that is £925,001 - £1,500,000.
Band 4 - 12% Stamp Duty on any property over £1.5 million.

For example, if you're buying a property for £275,000, you will pay 7% Stamp Duty. Although the table states £250,001-£950,000 which is only 5% Stamp Duty, you must pay the percentage of each band until you reach the band of your properties purchase price. Band 1 - 0% = £0, Band 2 - 2% = £5,500 and Band 3 - 5% = £13,750. Therefore the Stamp Duty totals, £19,250.

Within 30 days of purchasing your property Stamp Duty must be paid. If you're using a solicitor to carry out the conveyancing for you, they tend to organise this payment.

However, if you are buying in England or Northern Ireland as a First-Time Buyer, you won't pay any Stamp Duty on properties worth up to £300,000. If you purchase a property fetching up to £500,000, you will only pay Stamp Duty on the remaining £200,000.

At Hayward Moon, we are happy to answer any Stamp Duty questions you may have. Contact us to speak to an expert – we’re happy to help.

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Bury St Edmunds 01284 727290
Diss 01379 646040
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