Stamp Duty Tax Calculator - July 2020 Update
The UK Government's Chancellor has announced homebuyers will not have to pay stamp duty when purchasing their main home up to £500,000, in England and Northern Ireland, until 31 March 2021. Purchasers of residential houses purchased in excess of £500,000 will still need to pay stamp duty.
This announcement replaces the previous 0% stamp duty threshold which was up to £125,000, or £300,000 for first-time buyers (if a property was worth less than £500,000). Stamp duty on purchases of a primary residence will be paid on as follows up until 31st March 2021:
- Up to £500,000 no stamp duty to be paid
- 5% stamp duty to be paid between £500,001 to £925,000
- 10% stamp duty to be paid between £925,001 to £1,500,000
- 12% stamp duty to be paid in any amount in excess £1,500,001
The 3% higher rate for purchases of additional dwellings applies on top of revised standard rates above for the period 8 July 2020 to 31 March 2021.
We have updated our calculator below to give you the correct information on how much stamp duty you need to pay now.
Stamp Duty Land Tax (SDLT) is payable to HMRC when buying property or land over a certain value in England, Northern Ireland and Wales. In Scotland, Stamp Duty has been replaced by Land & Buildings Transaction Tax.
Stamp Duty applies whether you are purchasing a property for investment or to live in, and to both freehold and leasehold properties. The tax is levied progressively, in a similar way to income tax. As of July 2020 purchases of up to £500,000 no longer attracts the tax.
From 8 July 2020 to 31 March 2021 the special rules for first time buyers are replaced by the reduced rates.
Calculating your liability to Stamp Duty depends on the type of property you are buying, and whether it is your principal private home, a second home/buy-to-let or a non-residential or mixed-use property as detailed below.
If you are purchasing a residential property, are not a first-time buyer, and this will be the only residential property you will own, whether you live in it or not, you will pay Stamp Duty if the transaction price is above £500,000. Thereafter, you pay tax progressively as follows:
- From £500,001 to £925,000 - 5%
- On the portion from £925,001 to £1.5 million -10%
- On the remaining amount (the portion above £1.5 million) - 12%
Since April 2016, anyone purchasing a second home or buy-to-let property above £40,000 (unless this is the only property you own) will have to pay an additional 3% on top of the amounts detailed above.
If you are purchasing a property which you intend to use as your only home, but haven’t yet sold your previous home, you would have to pay the higher rates above but if you sell your old property within 36 months you could get a refund.
Non-residential property includes:
- Commercial property,eg shops, industrial or offices
- Agricultural land/farms
- Any other land or property which is not used as a residence
- 6 or more residential properties bought in a single transaction
A ‘mixed use’ property is one that has both residential and non-residential elements, eg a flat connected to a shop or office.
If the property is classified as non-residential or mixed-use land and property then, as from the 17th March 2017 there is a stepped regime for Stamp Duty as follows:
- Up to £150,000 - 0%
- Above £150,000 and up to 250,000 - 2%
- Above £250,000 - 5%
This replaces the old regime which was a flat 4% of the purchase price.
When you buy a non-residential or mixed use leasehold interest you pay SDLT on both the:
- Purchase price of the lease (the ‘lease premium’)
- Value of the annual rent you pay (the ‘net present value’)
- These are calculated separately then added together.
If you buy an existing (‘assigned’) lease, you only pay SDLT on the lease price (or consideration).
The net present value (NPV) is based on the total rent over the life of the lease. From 8 July 2020 and until 31 March 2021 you don’t pay SDLT on the rent if the NPV is less than £500,000.
The nil rate band which applies to the ‘net present value’ of any rents payable for residential property is also increased to £500,000 from 8 July 2020 until 31 March 2021.
The following rates will apply:
- Net Present Value of any Rent
- Up to £500,000 Zero
- Over £500,000 1%
Companies as well as individuals buying residential property worth less than £500,000 will also benefit from these changes, as will companies that buy residential property of any value where they meet the relief conditions from the corporate 15% SDLT charge.
On the 1 April 2021 the reduced rates shown in the above tables will revert to the rates of SDLT that were in place prior to 8 July 2020 as detailed below
Net present value of rent
|£0 to £150,000||Zero|
|The portion from £150,001 to £5,000,000||1%|
|The portion above £5,000,000||2%|
You can work out how much SDLT you’ll pay for your non-residential lease using HM Revenue and Customs’ (HMRC) Leasehold SDLT calculator
You may pay a higher rate of SDLT for multiple purchases or transfers from the same seller.
Stamp Duty needs to be paid to HMRC within 30 days of completion of a transaction. Your Solicitor will normally deal with this payment on your behalf.
Please note – The information on Stamp Duty and the calculator are believed to be correct at the date of publication (last update April 2018) but purchasers should not rely on the figures provided and should seek confirmation from a Solicitor or Accountant to confirm liability to this and other possible taxes.