Stamp Duty Land Tax is a fee charged by the Government when you buy a new home in England for more than £125,000 – the amount of Stamp Duty you need to pay is determined on the price of your purchase.
There are several rate bands for Stamp Duty, and rates also vary if you are a first time buyer or if you own multiple properties. The tax is calculated on each part of the property purchase falling in each band.
For example, if you purchase a property for £400,000, you would be required to pay £10,000 in stamp duty:
- For the first £125,000, you wouldn’t pay any stamp duty
- For the next £125,000, you would pay £2,500 in stamp duty (2%)
- For the final £150,000, you would pay £7,500 in stamp duty (5%)