Stamp Duty Land Tax

Stamp Duty Land Tax (SDLT) has replaced Stamp Duty. Subject to certain exceptions, it is payable by the purchaser on property transactions by reference to the purchase price as follows:

Up to £125,000	nil
£125,001 - £250,000	1%
£250,001 - £500,000	3%
Over £500,000	4% (this is due to increase to 5% on 6 April 2011).

For First Time Buyers, however, the nil rate band applies in respect of purchases of up to and including £250,000. This concession is due to be withdrawn on 25 March 2012. Joint purchasers must both be First Time Buyers in order to qualify for the concession.

If the purchase price exceeds a particular rate band then the duty payable is at the higher rate on the whole purchase price.

SDLT is payable only on the purchase price and not on any price that may be agreed separately for the purchase of carpets, curtains and the like; it is payable on fixtures but not on fittings. By allocating part of the purchase monies to the purchase of fittings it may sometimes be possible legitimately to bring a transaction into a lower tax band for SDLT but the allowance for fittings must be reasonable and Inland Revenue may enquire into it.

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