When purchasing a property, different taxes can apply depending on the type of property you are buying, what you are planning to do with the property, and whether you are purchasing through a limited company or privately. This chapter looks Stamp Duty, which is the main tax paid when buying a property.

Company owned propertiesPersonally owned properties

Stamp Duty Land Tax (SDLT)

What is stamp duty?

Stamp Duty (also known as the Stamp Duty Land Tax or SDLT) is the tax that must be paid when purchasing property or land over a certain price. There are varying rates of stamp duty, depending on whether you are a first time buyer, if you already own property and if you are a non-UK resident. SDLT is charged at the same rate in a company as it would be in your own name.

How to pay stamp duty

Property buyers have 14 days from completion to send a SDLT return and make payment to HMRC - if you are using a solicitor or conveyancer, this will usually be handled by them for you. It’s worth noting that Stamp Duty applies in England and Northern Ireland; there are different taxes in Scotland and Wales..

Below, we’ve outlined the key details that buy-to-let investors need to know about Stamp Duty.

Buy-to-let Stamp Duty rates

When investing in additional properties, there is a 3% surcharge to pay in stamp duty compared to standard home movers, or first time buyers. This applies to both personally owned and limited company purchases.

The table below details the standard Stamp Duty rates for buy-to-let purchases. These rates will be reintroduced after 30th September 2021, following the Chancellors’ SDLT relief extension.

Portion of property price (England and NI)Buy-to-let stamp duty rate
£0-£40,0000%
£0-£125,0003%
£125,001-£250,0005%
£250,001-£925,0008%
£925,001-£1.5m13%
£1.5m+15%

Stamp Duty holiday extension

There is currently a stamp duty holiday in effect in England.

In the March Budget, the Chancellor announced an extension to the stamp duty holiday. The 3% additional charge for buy-to-let, holiday lets and second homes still applies.

Buy-to-let stamp duty extension rates July 1st 2021 - September 30th 2021:

Property priceStandard Stamp Duty rateBuy-to-let Stamp Duty rate
£0 to £250,0000%3%
£250,001 to £925,0005%8%
£925,001 to £1.5m10%13%
£1.5m+12%15%

Stamp Duty Calculator

Having an accurate estimate of the amount of stamp duty tax that would be due on a property before purchasing is an important step in your investment planning. We’ve built our handy Stamp Duty Calculator to make this quick, easy and accurate.

Stamp Duty Exemptions

Reliefs and exemptions available to offset stamp duty for more complex purchases, such as multiple dwellings relief.

Need advice on Stamp Duty reliefs and exemptions?

For more detailed information on Stamp Duty Tax, book a consultation with one of our property accountants.

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