Stamp duty UK 2011: frequently asked questions
We take a look at Stamp duty UK for 2011 and address some of the most common queries...
What is stamp duty?
Stamp duty is a government tax that applies to the purchase of property or shares. Stamp duty on property is referred to as Stamp Duty Land Tax (SDLT).
What is Stamp Duty Land Tax (SDLT)?
Stamp Duty Land Tax (SDLT) replaced Stamp Duty on property in 2003. It is a tax on the purchase price of land and buildings.
Do I have to pay stamp duty?
If you buy a freehold or a leasehold property and the purchase price is more than £125,000, you will pay stamp duty. If the purchase price is less than £125,000, no stamp duty is due.
What stamp duty will I have to pay in 2011?
This depends on the purchase price of the property. On properties purchased at £125,001 to £250,000, you will pay 1% of the purchase price. On properties purchased at £250,001 to £500,000, you will pay 3%. On properties purchased at £500,001 to £1 million, you will pay 4%. On properties purchased for over £1 million, you will pay 5%.
What about first time buyers?
First time buyers don't have to pay stamp duty on property up to a purchase price of £250,000. This higher threshold applies until 25 March 2012, at which time the SDLT due will return to normal levels.
What are SDLT Disadvantaged Areas Relief?
If you buy a property in an area that the government has designated as disadvantaged, you may qualify for stamp duty relief up to a threshold of £150,000.