Stamp Duty Land Tax (SDLT) is an additional fee that must be paid when purchasing property or land over a certain value in England and Northern Ireland. This value is known as the threshold. Scotland and Wales have a slightly different system when it comes to this tax. The amount that must be paid depends on the price of the property or land being purchased. McPartland & Sons solicitors will take you through the new stamp law duties coming into effect on 1st April 2025.
Who has to pay stamp duty tax?
There are different types of property purchases in which the new owner is required to pay stamp duty tax if it is over one of the price thresholds. Those applicable are:
- Buyers of freehold properties – properties which include ownership of the land it is built on.
- Buyers of new or existing leaseholds – properties which will be owned for a length of time agreed with the freeholder, i.e. the lease. Examples can be flats which don’t include ownership of the building they’re in, or a house without the land it sits on.
- Buyers of shared ownership properties – properties which are having a percentage of ownership purchased through a scheme run by an approved public body.
- Recipients of land or property transferred in exchange for payment or non-monetary payment, for example, taking on a mortgage. However, SDLT in these cases depends on the circumstances of the transfer.
How Much Stamp Duty Do I Pay?
The amount of SDLT you pay depends on the purchase price of the property. Here are the current rates for residential property purchases in Northern Ireland, followed by the new rates coming into effect on April 1st, 2025:
Current Rates (Until March 31st, 2025):
- £0 – £250,000: 0%
- £251,000 – £925,000: 5%
- £925,000 – £1.5 million: 10%
- £1.5 million+: 12%
New Rates (From April 1st, 2025):
- £0 – £300,000: 0%
- £300,001 – £500,000: 4%
- £500,001 – £925,000: 5%
- £925,001 – £1,500,000: 10%
- £1,500,001+: 12%
Important Considerations:
- First-Time Buyers’ Relief: First-time buyers in Northern Ireland may be eligible for relief from SDLT on the first £425,000 of the purchase price. It is important to confirm the most up to date rules with a solicitor.
- Additional Dwelling Relief: If you already own a property and are buying an additional home, you may be liable to pay an extra 3% on top of the standard SDLT rates.
- Land and Property Transactions: SDLT also applies to commercial property purchases, leases, and other land transactions.
- Changes to Legislation: SDLT rates and rules are subject to change, so it’s crucial to seek professional advice to stay informed.
How do I pay stamp duty?
Typically, you have 30 days from the completion of your property purchase to pay SDLT. Payment can be made online, via bank transfer, or by cheque. Adhering to HMRC’s instructions and deadlines is essential to avoid penalties. Consulting with a solicitor can help ensure timely payment.
Has stamp duty laws changed since Covid-19?
During the COVID-19 pandemic, the UK government implemented temporary SDLT reductions to stimulate the housing market. These reliefs have since expired, and SDLT rates have generally returned to pre-pandemic levels, with the addition of the 2025 changes.
How is stamp duty normally calculated?
SDLT is calculated using a tiered percentage system based on the property’s purchase price. HMRC provides online SDLT calculators and guidance on claiming reliefs and exemptions.
How can McPartland & Sons assist with Stamp Duty?
McPartland & Sons solicitors can provide tailored advice; help minimise tax liability and manage the legal aspects of property transactions. The expert team can assist with organising your SDLT payment, ensuring the return is filed, and the tax is paid on the day of completion. This service saves you from having to navigate the process independently. Even if no SDLT is due, a return must still be filed.
If you have any questions about stamp duty or require legal assistance with moving then get in touch and book a free consultation with one of our conveyancing experts. Click over to our Domestic Conveyancing page to learn how we can help.