If you are in the process of purchasing land or if you are in the process of purchasing a new home or a second home or buy-to-let you will incur stamp duty land tax. You pay this one-off tax at the end of the conveyancing process. Once a mortgage has been agreed solicitors are involved to ensure that the transfer of funds goes correctly. the property that you are looking to purchase must also be valued. Stamp duty land tax is an excellent way for the government to recover incoming taxes. It operates on a simple sliding scale and is billed at the end of the process.
Your solicitors and conveyancers will cover the details but it is always wise to be forearmed as to what is going to happen. Put simply if you are purchasing a property below £250,000 you do not need to pay stamp duty land tax. If you are a first-time buyer you are also exempt from stamp duty land tax. If the property is priced below £40,000 you will still make a declaration.
Stamp duty land tax is calculated depending on the price of the property. If your property is priced anywhere between £250,000 and £675,000 5% of its cost price. If any portion of the purchase is above £575,000 you will pay 10%. This threshold ends at £1.5 million. Any portion above £1.5 million is charged at 12%. Therefore the negotiation of the cost price of the property or the land is very important. SDLT Refunds may be available. Go to sentientsdlt for more info.