Buying a house? Read up on property duty rates 2011

Buying a house or property, either for the first time or as an previous home buyer, is an exciting moment! But there are also many facts and figures on which you need to be up-to-date. One of these is property duty, also known as stamp duty land tax (SDLT).

What is property duty, I hear you ask? Simply put, this is a tax that must be paid for the purchase of houses, flats and other land and buildings. The person responsible for paying this tax is the purchaser, however, usually a solicitor or licensed conveyancer manages the payment on behalf of the buyer.

Now you know what property duty is, it is time to talk about the new property duty rates 2011. Basically, two changes have been made: the rates have been modified for first time home buyers and there is now a new higher stamp duty rate introduced for more expensive homes sold after April 2011.

Let us start with first home buyers: good news! Starting from April 2010 for a period of two years, first time buyers do not have to pay property duty on any house purchased that has a value of up to £250,000. This new rate replaces the normal 1% and 3% property duty amount. First time buyer stamp duty rates are valid until 24th March 2012.

For those of you who are previous home buyers, then you must know that as of April 2011, a new property tax will apply to houses sold in excess of £1 Million. This property duty is 5%, which is applied to the sale price of the property.

Here is a full list of all the taxes: for houses up to £125,000, property duty is 0%; from £125,001 to £250,000 it is 1%; from £250,001 to £500,000 it is 2%: from £500,001 to £1 Million it is 4%; over £1 Million it is 5%.

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