Stamp Duty Land Tax (SDLT) when buying a residential property
Investors that wish to purchase a residential buy to let property will need to pay Stamp Duty Land Tax for:
– Stamp Duty banded rates for property values over £125,000
– The 3% Stamp Duty higher rate for people that are buying a second property in their name or any property in a limited company
Please note that the 3% Stamp Duty higher rate does not need to be paid if you buy a property that is the only property in your name. You do not need to pay the 3% SDLT higher rate when purchasing a home that replaces your existing home. By this, we mean you are selling your main home in the same transaction as buying a new home.
Have you overpaid Stamp Duty Land Tax?
We can help you recover overpaid SDLT when buying a residential, mixed-use or commercial property? Please tell us about your overpayment to see if we can get it back from HMRC.
Is it possible to reduceStamp-Duty-Land-Tax when purchasing a buy to let property
You must calculate the SDLT liability when buying a buy-to-let property. You need to check the Stamp-Duty calculations that conveyancing solicitors perform on your behalf. Stamp-Duty-Land-Tax is paid over to HMRC within 14 days of the house purchase, but conveyancing solicitors will take the money from you as part of the completion process.
We have found mistakes by conveyance solicitors when they perform Stamp-Duty calculations for our clients. Errors in SDLT could cost you tens of thousands of pounds, which could have been avoided if the calculations were checked first with the conveyance solicitor.
There are many ways to minimise Stamp-Duty. One of the ways to reduce SDLT is to purchase mixed-use properties such as a flat above a shop. This particular transaction is referred to as mixed-use properties, and the Stamp Duty is based on non-residential rates rather than residential, which is cheaper.
Another way to reduce Stamp-Duty is to buy multiple properties from the same seller. An SDLT tax relief called Multi-Dwellings-Relief (MDR) allows you to take the average property values. This could mean you pay lower Stamp-Duty-Land-Tax scales rates, reducing your tax liability when purchasing a buy-to-let property investment.
It is possible to reclaim Stamp Duty if you pay more SDLT than you should have. This overpayment may have been caused by the conveyance solicitor incorrectly calculating and paying tax to HMRC within 14 days of the buy to let purchase. It is possible to reclaim overpaid SDLT, and we are on hand to help you.
It is important to speak with a property tax specialist when you want to understand more about the SDLT reliefs above, as our Stamp-Duty calculator is not sophisticated enough to take all matters into account.
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Stamp Duty Land Tax for non-residential (commercial) property purchases
Please note that this Stamp Duty calculator is to help you work out the SDLT tax when buying a residential property. Please use our free residential property stamp duty land tax calculator if you want to work out the tax liability of buying a non-residential (commercial property).
Calculating Stamp Duty when buying a residential property
Now that you have understood how Stamp-Duty-Land-Tax works and how SDLT may be reduced, it is time for you to perform your own calculations. Please use our fee educational SDLT calculations. We strongly advise that you work with your solicitor/accountant/property tax advisor based on the numbers produced on our SDLT calculator. Optimise Accountants cannot accept any responsibilities for the numbers produced or the decisions made.