Tax Planning for UK Investments - Stamp Duty

S.42 of Finance Act 2003.  You must pay Stamp Duty Land Tax (SDLT) if you buy a property or land over a certain price in England, Wales and Northern Ireland.

  • ·         The current SDLT threshold is £125,000 for residential properties and £150,000 for non-residential land and properties.
  • ·         SDLT no longer applies in Scotland. Instead you pay Land and Buildings Transaction Tax when you buy a property.

You pay the tax when you:
  • ·         buy a freehold property
  • ·         buy a new or existing leasehold
  • ·         buy a property through a shared ownership scheme
  • ·         are transferred land or property in exchange for payment, eg you take on a mortgage or buy a share in a house

Rates - How much you pay depends on whether the land or property is:
  • ·         residential
  • ·         non-residential or mixed-use
  • ·         You can use HM Revenue and Customs’ (HMRC) Stamp Duty Land Tax calculator to work out how much tax you’ll pay. (There’s a different calculator for leases.)
  •        You may be able to reduce the amount of tax you pay by claiming relief, eg if you buy more than one property (‘multiple dwellings’).
  •        The value you pay SDLT on (the ‘consideration’)
  •        The total value you pay SDLT on (sometimes called the ‘consideration’) is usually the price you pay for the property or land.
  •         Sometimes it might include another type of payment like:

o   Goods
o   works or services
o   release from a debt
o   transfer of a debt, including the value of any outstanding mortgage
o   Find out how to work out the consideration if your situation is complicated.

How and when to pay
  • ·         You must send an SDLT return to HMRC and pay the tax within 30 days of completion.
  • ·         If you have a solicitor, agent or conveyancer, they’ll usually file your return and pay the tax on your behalf on the day of completion and add the amount to their fees.
  • ·         If they don’t do this for you, you can file a return and pay the tax yourself.
  • ·         There are certain situations where you don’t need to send a return.


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