Stamp Duty Calculator | Rate Changes 2020 | CBRE Residential

Find out about the latest stamp duty rate changes in 2020 and use our handy SDLT calculator to see how much you must pay on your property in London.

- Stamp Duty Calculator & Rate Changes 2020

Until April 2021, stamp duty payments will only be required for main residences worth over £500,000 in England and Northern Ireland, and £250,000 for Scotland and Wales. Use our stamp duty land tax (SDLT) calculator to see the amount due when purchasing a property in London.
 

- What is Stamp Duty?

Stamp Duty Land Tax (SDLT) is a tax paid when purchasing a freehold, leasehold, shared ownership residential property or piece of land worth over a certain threshold.

It’s also known as 'land and buildings transaction tax' and 'land transaction tax' in Scotland and Wales, which use different rate bandings to England and Northern Ireland.

*For first-time buyers, the usual rules are temporarily replaced by these reduced stamp duty rates. This applies whether you’re buying a property in England, Northern Island, Wales or Scotland.
 

- Stamp duty rates in England and Northern Ireland

Until the 31st March 2021, temporary stamp duty rates have been rolled out across England and Northern Ireland. These new thresholds now mean that, since the 8th July 2020, no stamp duty is due on any main property up to the purchase price of £500,000. 

These are the new rates for primary and additional properties:

Property Price Thresholds

Main Property Rates

Rates for Additional Properties

£0 - £500,000 

0%

3%

£500,001 - £925,000

5%

8%

£925,001- £1,500,000

10%

13%

£1,500,001+

12%

15%

The above rates apply to that portion of the property price. For example, if you’re buying a property for £600,000, the calculation for how much stamp duty to pay would be as follows:

  1. You would pay no stamp duty on the first £500,000.
  2. You then pay 5% as the property sits within the £500,001 - £925,000 bracket. So, £600,000 (total purchase price) - £500,000 (the amount with no stamp duty) = £100,000.
  3. 5% of £100,000 = £5,000, would be the amount you pay.

For those with buy-to-let or second properties, any purchase prices over £40,000 are subject to the rates in the above table.

For example, if you wish to buy a second home worth £200,000, you would be required to pay 3% on the portion between £40,000 and £200,000 (which would be £4,800).
 

- Stamp duty rates in Wales

The stamp duty system has now been replaced with land transaction tax (LTT) by the Welsh Revenue Authority, and the rates set by the Welsh Government.

From the 27th July 2020 until the 31st March 2021, new rates mean that no stamp duty is due on any main residential property up to £250,000, and £150,000 for non-residential land and properties.

These are the new rates for primary and additional properties:

Property Price Thresholds

Main Property Rates

Rates for Additional Properties

£0 - £250,000 

0%

3% (6.5% between £180,001 and £250,000)

£250,001 - £400,000

5% 8%

£400,001- £750,000

7.5% 10.5%

£750,001 - £1,500,000

10% 13%

£1,500,001+

12% 15%

For example, if you’re buying a main property for £275,000 in Wales, the LTT calculation would be:

  1. You would pay no stamp duty on the first £250,000.
  2. You then pay 5% as the property sits within the £250,001 - £400,000 bracket. So, £275,000 (total purchase price) - £250,000 (the amount with no stamp duty) = £25,000.
  3. 5% of £25,000 = £1,250, would be the amount you pay.

Alike the other regions, if you’re purchasing a second property, any purchase price over £40,000 is subject to the rates in the above table.

For more information, please visit the Welsh Government’s Land Transaction Tax page.

 

- Stamp duty rates Scotland

As with in Wales, stamp duty land tax was replaced with ‘land and buildings transaction tax’ (LBTT) in April 2015. The concept remains the same though; LBTT is a tax applied to non-residential land and buildings, also including commercial leases, and is administered by Revenue Scotland.

Until the 31st March 2021, no stamp duty will be due on any main property up to the purchase price of £250,000.

Scotland’s LBTT rates for both primary and additional properties are:

Property Price Thresholds

Main Property Rates

Rates for Additional Properties

£0 - £250,000 

0%

4% (6.5% between £145,001 and £250,000)

£250,001 - £325,000

5%

9%

£325,001- £750,000

10%

14%

£750,001+

12%

16%

For example, if you’re buying a property for £500,000, this is how the Scottish system would work:

  1. You would pay no stamp duty on the first £250,000.
  2. You then pay 5% on between £250,001 - £325,000 which is £3,750.
  3. Between £325,001- £500,000 you would pay 10%, equalling £8,750.
  4. In total, the amount of LBTT to pay is £12,500 (£0 + £3750 + £8,750).

For buy-to-let or second properties, any property worth over £40,000 means that you’ll have to pay the rates in the above table.

For more information, head over to Revenue Scotland’s Land and Buildings Transaction Tax page.

 

- How to pay stamp duty and when do you pay it?

While your solicitor will likely arrange this on your behalf and send you the bill ahead of time, you are legally responsible for ensuring that the amount is settled.

 

- In England or Northern Ireland:

Since new legislation in March 2019, you now have 14 days from the date of completion to pay stamp duty in England or Northern Ireland. If not paid by this deadline, you risk facing a fine or additional interest.

There are various methods to pay stamp duty in England and Northern Ireland, but first you’ll need your unique transaction reference number (UTRN) which is 11 characters long and can be found on your paper return or on your electronic SDLT5 certificate:

  1. Faster Payments, BACS or CHAPS
    Faster Payments by online or telephone banking (payable to HRMC’s account here) will usually reach HMRC on the same/next day (including weekends and bank holidays), with CHAPS reaching the same working day (depending on your bank’s processing times). BACS usually take three working days, so bear this in mind to avoid missing the deadline.
     
  2. Online debit or corporate credit card
    While you can’t pay with a personal credit card, it’s easy to make the payment out with a debit card or corporate credit card (with the latter is a non-refundable fee). HRMC should receive your payment the same or next day.
     
  3. Bank or building society
    Pay at your bank branch (to avoid a fee) by cheque or cash. Cheques can be made payable to ‘HM Revenue and Customs’ with your UTRN written on the front.
     
  4. Cheque
    You can pay by cheque through the post, also payable to ‘HM Revenue and Customs only’, followed by your UTRN number. Make sure to allow three working days for your payment to reach HRMC and use one of the following addresses:

    - Paper return:
    BT Stamp Duty Land Tax
    HM Revenue and Customs
    BX9 1LT

    - Electronically filed return (enclosing a payslip or quoting a UTRN):
    HM Revenue and Customs
    Direct
    BX5 5BD

 

- In Wales:

Land Transaction Tax is paid to the Welsh Revenue Authority and must be received within 30 days of completing on your property (only solicitors can file and pay online).

First, go to the Welsh Revenue Authority’s (WRA) site and submit a paper tax return to register the transaction.

Once your return has been processed by the WRA, you’ll be given a UTRN. Make sure to quote the following payment reference number for your online payment or the back of your cheque: “Postcode of lead buyer \ Surname or organisation name of lead buyer”

You can pay using the below methods:

  1. BACS or CHAPS and Faster Payments
    Quote your 12-digit UTRN reference number followed by an additional reference if you choose for your internal use. For paper tax returns, make sure to also quote the above reference. For BACS, make sure WRA have received your payment (made to WRA’s bank account here) four working days before the deadline to process.
     
  2. Cheque
    Pay by cheque to the WTA with your UTRN or payment reference number (paper filing) and post to:

    Welsh Revenue Authority
    PO Box 110
    Pontypridd
    CF37 9EH

    The WRA must receive your cheque within 10 working days before the due date to process.

 

- In Scotland:

Scotland’s Land and Buildings Transaction Tax system means that you also have 30 days to pay Revenue Scotland from the date of completion.

First, you’ll need to submit an online return (paper returns are temporarily unable to be accepted) on Revenue Scotland’s website. Once you’ve submitted your return, you’ll be prompted to select your payment method, and a unique 13-character transaction reference (starting with ‘RS’, followed by seven numbers and four letters) will show on screen. You must quote this when making the payment:

  1. Faster Payments, BACS or CHAPS
    These should be made to the Revenue Scotland bank account shown on this page. Make sure to quote the 13-character reference as the payment reference when doing this and also check your bank’s daily cut-off time for processing same-day payments.
     
  2. Cheque
    You can easily make a payment by cheque to Registers of Scotland:

    Meadowbank House
    53 London Rd
    Edinburgh
    EH8 7AU

 

- Can you add stamp duty to your mortgage?

Yes – you can add the cost of stamp duty to your mortgage, but this means a bigger loan is needed, which may not be suitable for everyone.

It’s key to bear in mind that spreading the cost of your stamp duty long term with your mortgage (around 25 years or more) will add interest to your total repayment. For example, if you need an £180,000 mortgage to buy a house worth £300,000, you’d need to request an extra £5,000 on top of your mortgage loan. Over 25 years at a rate of 5% interest would cost an estimated £8,500 in interest.

You loan-to-value ratio, or LTV (how much of your property’s value you’re borrowing) could also be shifted by this extra borrowing. Most deals require a maximum of 60% so be aware and always seek advice from a mortgage broker.

 

If you’re interested in purchasing an incredible property in the heart of London, head to our live listings to browse your new luxury home. Or, if you’d like to find out more useful information surrounding the latest residential trends and other market news, our Research and News hubs offer everything you need to know.