Changes to stamp duty, September 2022: On 23 September, Chancellor of the Exchequer Kwasi Kwarteng announced a change to stamp duty rates. The starting threshold for paying stamp duty will be raised to £250,000 (from its current starting point of £125,000). This means that house buyers will not have to pay stamp duty on the first £250,000 of any property purchase (a tiered tax will still apply on amounts over that). So if the property you’re buying costs less than £250,000, there is no stamp duty to pay at all. For first-time buyers, the starting threshold for paying stamp duty will be raised even further to £425,000 (providing the property being purchased does not cost more than £625,000). These stamp duty changes apply to England and Northern Ireland only. It has not yet been confirmed by the government how long these amended stamp duty rates will apply for.
Stamp duty rates in England and Northern Ireland November 2024
Stamp duty rates in England and Northern Ireland are exactly the same. It is officially called stamp duty land tax (SDLT). As per our update above, for the moment house buyers will pay 0% on the first £250,000 of a house purchase, rather than the first £125,000.
For home movers
Portion costing between £0-£250,000: 0%
Portion costing between £250,001-£925,000: 5%
Portion costing between £925,001-£1.5m: 10%
Portion costing over £1.5m: 12%
For first-time buyers
If you are a first-time buyer, you can claim a relief. However, if the price is over £625,000 then the same rates as people who have bought a home before apply.
Portion costing between £0-£425,000: 0%
Portion costing between £425,001-£625,000: 5%
For second homes
If you’re buying a second home in England or Northern Ireland, you’ll essentially pay a 3% surcharge on each of the stamp duty tiers. Here are the rates.
Stamp duty in Scotland (LBTT) – Rates November 2024
Stamp duty in Scotland is called “land and buildings transaction tax” (LBTT).
For home movers
Portion costing between £0-£145,000: 0%
Portion costing between £145,001 and £250,000: 2%
Portion costing between £250,001 and £325,000: 5%
Portion costing between £325,001 and £750,000: 10%
Portion costing over £750,001: 12%
For second homes
If you’re buying a second home in Scotland, you’ll essentially pay a 4% surcharge on each of the stamp duty tiers. Here are the rates combining the LBTT and the Additional Dwelling Supplement (ADS).
Portion costing between £0-£145,000: 4% (although you’ll pay no stamp duty on purchases below £40,000).
Portion costing between £145,001 and £250,000: 6%
Portion costing between £250,001 and £325,000: 9%
Portion costing between £325,001 and £750,000: 14%
Portion costing over £750,001: 16%
Stamp duty in Wales (LTT) – Rates November 2024
Stamp duty in Wales is called “land transaction tax” (LTT).
For home movers and first-time buyers
Portion costing between £0-£180,000: 0%
Portion costing between £180,001-£250,000: 3.5%
Portion costing between £250,001 and £400,000: 5%
Portion costing between £400,001 and £750,000: 7.5%
Portion costing between £750,001 and £1.5m: 10%
Portion costing over £1.5m: 12%
For second homes
Portion costing between £0-£180,000: 3%
Portion costing between £180,001-£250,000: 6.5%
Portion costing between £250,001 and £400,000: 8%
Portion costing between £400,001 and £750,000: 10.5%
Portion costing between £750,001 and £1.5m: 13%
Portion costing over £1.5m: 15%
How and when do I pay stamp duty?
Your stamp duty bill is due no more than 30 days after you complete the purchase of a property. Your conveyancer will usually send your stamp duty payment to HMRC on your behalf on completion day.
It is sometimes to possible to borrow more from your mortgage lender to fund your stamp duty bill. However, this should be avoided as it means you’ll be paying interest on it for the entirety of your mortgage term.
There is a small list of cases where you’ll be exempt from stamp duty, including with inherited properties, zero-carbon home purchases under £500,000, some Right To Buy transactions and charity purchases. The full list is available on the HMRC website.
Do I have to pay stamp duty?
If a property costs under a specific amount, you won’t have to pay any stamp duty.
There are also other exemptions. You won’t pay stamp duty in the following situations:
Property is left to you in a will
Property is transferred to you as a gift
Property is transferred to you because of divorce or dissolution of a civil partnership
You buy a lease of less than seven years (provided it costs less than the stamp duty bill)
You use alternative finance arrangements, such as those that comply with sharia law
There are numerous circumstances where you may be eligible for stamp duty relief. These include the following:
Some Right To Buy transactions
When buying multiple properties
House-building companies buying an individual’s home
Employers buying an employee’s home
Local authorities making compulsory purchases
Inter-company property transfers
Charities buying property
Purchases by registered social landlords
How much stamp duty will I pay if I buy a new home before selling my old one?
You’ll have to pay the rate for second homes (an additional 3%) but you can claim a refund if you sell your previous home within 36 months of buying the new one. You’ll have 12 months from the sale of your old home to claim this refund.
The same rules apply if you have your name removed from the deeds of a property.
Can I add stamp duty onto my mortgage?
Some lenders will lend you extra money to cover the cost of your stamp duty and add this to your mortgage.
This isn’t ideal though because you’ll be paying interest on this figure for the entirety of your mortgage term.
Think carefully before securing debts against your home. Your home may be repossessed if you do not keep up repayments on your mortgage.
Stamp duty on investments
You may have to pay stamp duty reserve tax (SDRT) when you purchase shares. This depends on the company you’ve chosen to invest in. How you’ll pay depends on how yoy purchase the shares.
Buying shares electronically
When you choose to buy UK company shares electronically, you’ll see a charge for stamp duty. This is 0.5% of the amount you pay for your shares, regardless of the market value.
You’ll encounter this charge if you buy:
Existing shares in a UK incorporated company
An option to buy shares
An interest in shares
Shares in a foreign company that has a share register in the UK
Rights arising from shares
You won’t have to pay stamp duty reserve tax if:
You are given the shares for free
Subscribe to a new issue of shares
Buy shares in an open ended investment company (OEIC) from the fund manager
Buy units in a unit trust from the fund manager
You’re automatically charged stamp duty reserve tax if you buy shares through the computerised register of shares and shareowners (CREST) system — the chances are that if you’ve used an online share dealing provider of any kind, this is the case.
If you buy shares off market
If you buy shares “off market”, which is where the shares are transferred to you outside of the CREST system, you’ll still need to pay stamp duty. You’ll need to contact HMRC with details of the transaction.
If you buy shares with a stock transfer form
If you purchase your shares through a stock transfer form and the transaction is over the value of £1,000, you’ll need to pay 0.5% in stamp duty, rounded up to the next £5.
You don’t need to pay anything for shares under £1,000. To pay, you’ll need to send your transfer form to HMRC and pay the stamp duty. You can do this via email or post.
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Matthew Boyle is a banking and mortgages publisher at Finder. He has a 7-year history of publishing helpful guides to assist consumers in making better decisions. In his spare time, you will find him walking in the Norfolk countryside admiring the local wildlife. See full bio
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