Stamp duty

When is it due ?

If you purchase a property over a certain price, stamp duty is payable to HMRC 30 days from the date of completion. If you miss the payment you may risk a fine. This is why most sellers allow their legal advisor to take care of the payment. You can add the stamp duty to your mortgage loan but speak to an independent advisor first before planning this.

Stamp Duty Holiday- what is this?

In normal circumstances, stamp duty land tax or (SDLT) is a progressive tax when purchasing a freehold, leasehold or shared ownership residential property over £125,000 in England. It is charged using a sliding scale system based on thresholds and dependent on a property’s price.

Non-residential property qualifies for different rates and thresholds of SDLT.

As part of the economic measures taken to support people during the pandemic, the Chancellor announced in July that he would be granting a stamp duty holiday to purchasers on their main homes if the property has a value of up to £500k. This measure is due to last until 31 March 2021.

Full information can be found here

Buy to let and second homes stamp duty

The stamp duty holiday does not apply to second properties. From April 2016 buyers in England and Wales have had to pay an additional 3% on each stamp duty band for any additional property they purchase, other than their main residence.

Owning additional properties and your tax position has become complicated since this change and we recommend seeking advice from your accountant or solicitor to discuss your position.

How to claim back stamp duty on your second home

You are able to apply to HMRC for a refund of the additional rate of stamp duty if you sell your previous main residence within 3 years of your paying the higher rate of Stamp Duty.