You must pay Stamp Duty Land Tax (SDLT) if you buy a property or land over a certain price in England. This tax applies to both freehold and leasehold properties, whether you’re buying outright or with a mortgage.
The current SDLT threshold for residential properties is £250,000. If you buy a property for less than this threshold there is no SDLT to pay, unless you are purchasing as a buy-to-let or second home, where different rates apply.
Above the £250,000 threshold there are graduated bands of SDLT rates. You can calculate how much Stamp Duty you will have to pay using the government Stamp Duty Calculator.
If you and anyone else you’re purchasing with are first-time buyers and the property is £625,000 or under, you should qualify for a discount:
- You will pay no stamp duty at all up to £425,000
- And 5% on the portion from £425,001 to £625,000
However, if the property price is over £625,000 you cannot claim the discount and you will follow the same Stamp Duty rules as those who have bought a home before.