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If you purchase a property that costs more than £125,000 (or more than £40,000 if buying a second home) you’ll be required to pay Stamp Duty Land Tax (SDLT) on your purchase. 


Stamp duty applies to freehold and leasehold properties and whether you are buying outright or taking out a mortgage. 


How is stamp duty calculated? 


Stamp duty is split into different bands, and the tax is calculated on the portion of the property price that falls within each band. 


The bands for residential purchase are below: 


£0 - £125,000 = 0% stamp duty 

£125,001 - £250,000 = 2% stamp duty 

£250,001 - £925,000 = 5% stamp duty 

£925,001 - £1.5m = 10% stamp duty 

Over £12m = 12% stamp duty 


For example, if you purchased a property worth £255,000, you’d pay 0% stamp duty on the first £125,000, 2% on the next £125,000 and 5% on the final £5,000. 


What about buy-to-let stamp duty rates? 


Just like residential stamp duty rates, the rates for buy-to-let properties and second homeowners are tiered. 


The new bands for buy-to-let stamp duty rates are below: 


£0 - £40,000 = 0% stamp duty 

£0 - £125,000 = 3% stamp duty 

£125,001 - £250,000 = 5% stamp duty 

£250,001 - £925,000 = 8% stamp duty 

£925,001 - £1.5m = 13% stamp duty 

Over £1.5m = 15% stamp duty 


Are there any exemptions? 


You will not be required to pay stamp duty land tax if you are purchasing a mobile home or caravan, or a houseboat, regardless of purchase price. 


To discuss stamp duty in relation to a property you are looking at purchasing, talk to one of our expert advisers today