What is Stamp duty?
We just call it stamp duty as that’s the name for what we’ve paid (in England). We paid this when we bought our house to live in. Stamp duty is known as land transaction tax in Wales. In Scotland it is called land, buildings and transaction tax.
Stamp Duty Land Tax
When you buy a residential property or a piece of land which costs more than £125,000 in England and Northern Ireland you will pay Stamp Duty Land Tax (SDLT). HMRC calculates it in bands.
If you buy an additional residential property you pay SDLT when the house costs more than £40,000. This applies to second homes and buy to let properties. You will have to pay an extra 3% on top of the current SDLT rates for each band.
The full explanation is on the SDLT page of Gov.uk, which includes a link to the HMRC Stamp Duty Land Tax calculator.
Land Transaction Tax
If you buy a home in Wales you pay Land Transaction Tax (LTT) on residential properties which cost over £180,000. LTT replaced SDLT in Wales from April 2018.
HMRC sets out the rates of LTT in bands. Different rules apply if you are buying a second residential property (including for buy to let).
There is a full explanation on the LTT guide page of gov.wales. Since it can be hard to calculate, they have shared a LTT Calculator to help you figure out how much to pay.
Land Buildings and Transaction Tax
If you buy a property in Scotland you pay Land and Buildings Transaction Tax (LBTT). LBTT replaced SDLT in Scotland from April 2015.
England and Wales have set the rates out in bands. From April 2016, an Additional Dwelling Supplement (ADS) is payable on the total purchase price of an additional dwelling with a price of £40,000 or more. This is something that needs to be taken into account if you are not just buying-to-let.
ADS is a 4% charge on top of the total purchase price of the dwelling. This is on top of the LBTT charge.
We found a good explanation on the gov.scot LBTT page. More more detailed information being provided on the LBTT page of Revenue Scotland.
Revenue Scotland also provides LBTT calculators for the different kinds of purchases.