Stamp Duty Guide for 2015
In December 2014 the Government reformed the stamp duty on residential property. For many this has been a benefit and according to HMRC stamp duty has been cut for 98% of people who pay it.
So, What's Changed?
The government have done away with the old stamp duty bands, where you used to pay a single rate on the whole property price, depending on which band you fell into, and replaced it with a tax structure that will work more like income tax. This seems to be a fairer way for the majority but these new stamp duty rates can be confusing. Hopefully, that's where we can help with our stamp duty guide.
How Much Stamp Duty Will I Pay?
New Stamp Duty Rates:
|Purchase Price||Rate Paid On Each Part Of The Property Price Within Each Tax Band|
|£0 - £125,000||0%|
|£125,001 - £250,000||2%|
|£250,001 - £925.000||5%|
|£925,001 - £1,500,000||10%|
Example Stamp Duty Calculation: Therefore, if your property was worth £650,000 for example you would calculate your stamp duty as follows:
|£0 - £125,000||0%||(£125k x 0%)||£0.00|
|£125,001 - £250,000||2%||(£124,999 x 2%)||£2,499.98|
|£250,001 - £650,000||5%||(£399,999 x 5%)||£19,999.95|
|Total Stamp Duty To Pay||£22,499.93|
Further Example Properties:
|Property Price||Old Tax Paid||New Tax paid||% Change|
|£125,000 ? No Stamp Duty||£0||£0||0%|
More information and a stamp duty calculator can be found on the HMRC website. Fox Grant will also be delighted to offer a free consultation to anyone, buyer or seller on how the changes affect them. For more information please contact Fox Grant on 01722 782 727 or firstname.lastname@example.org
How Do I Pay Stamp Duty?
You have 30 days to submit your stamp duty return and the 30 days starts on the day of the completion of your property purchase.
Even if you are not due to pay stamp duty you will still need to complete the form, unless the property is worth less than £40,000.
You must make sure that you submit your return within the 30 days or you could face fines and interest on top! Your solicitor or conveyancer should be able to help with this but it is your responsibility to do it within the designated time frame so put a date in your calendar as a reminder.
When the time comes to pay, you will need your Unique Transaction Reference number which can be found on your submission receipt or on your paper return form. You can pay by online banking, over the telephone, by credit card on the website or by cheque. Just remember to quote your unique reference number.View more articles >