Stamp Duty in the UK:
What You Need to Know

Stamp Duty is a tax that is applied to the purchase of properties and land in the UK. It is a government tax that is collected by HM Revenue and Customs (HMRC) and is typically paid by the buyer of the property. The amount of Stamp Duty that is due will depend on the value of the property and the type of property being purchased. In this blog post, we will explain everything you need to know about Stamp Duty in the UK and how it might affect you.

When is Stamp Duty due?

Stamp Duty is typically due when the property is transferred from the seller to the buyer. This can happen in several ways, such as:

  • Completion of a sale
  • Execution of a lease
  • Transfer of a property as a gift
The due date for Stamp Duty will typically be within 30 days of the transfer of the property. It is important to note that if you do not pay the Stamp Duty on time, you may be subject to additional penalties and interest.

How much is the Stamp Duty rate?

The amount of Stamp Duty that is due will depend on the value of the property and the type of property being purchased. The current Stamp Duty rates are as follows:

  • Up to £125,000: 0%
  • £125,001 to £250,000: 2%
  • £250,001 to £925,000: 5%
  • £925,001 to £1,500,000: 10%
  • Over £1,500,000: 12%

It is important to note that there are some exemptions and reductions that may apply to certain types of properties and buyers. For example, if you are a first-time buyer, you may be eligible for a reduction in the Stamp Duty rate. Additionally, if you are purchasing a property for less than £500,000, you may be eligible for a reduced rate of 5%.

What is the process for paying Stamp Duty?

To pay Stamp Duty, you will need to complete a Stamp Duty Land Tax return. This return is typically completed by the solicitor or conveyancer handling the property purchase. Once the return is completed, it will be sent to HMRC along with the payment of the Stamp Duty.

It is important to note that if you are purchasing a property through a limited company, you will need to pay the higher rate of 15%. Additionally, if you are purchasing a second home or a buy-to-let property, you will need to pay an additional 3% on top of the standard Stamp Duty rate.
Stamp Duty can be a confusing and overwhelming process, but it is important to understand the rules and regulations to avoid any penalties or interest. If you have any questions or concerns about Stamp Duty, it is best to speak with a professional such as a solicitor or conveyancer.

Article correct when published in January 2023

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