This guide explains Stamp Duty Land Tax, legal fees and the other costs you should budget for when buying a property in England.
What is Stamp Duty?
Stamp Duty Land Tax (SDLT) is payable on the purchase of property or land in England and Northern Ireland above a certain price. (Wales and Scotland have their own taxes.) The amount depends on the price, whether you are a first-time buyer, and whether you will own more than one residential property after the purchase.
Use our Stamp Duty Calculator to work out the tax on your purchase.
Current Stamp Duty Rates
The standard residential rates of Stamp Duty Land Tax are:
- Up to £125,000: 0%
- £125,001 to £250,000: 2%
- £250,001 to £925,000: 5%
- £925,001 to £1.5m: 10%
- Over £1.5m: 12%
The rate applies only to the part of the price within each band.
First-time buyers pay no Stamp Duty on the first £300,000 and 5% on the portion from £300,001 to £500,000, provided the price is no more than £500,000.
Purchases of additional residential property, such as buy-to-let investments or second homes, attract a 5% surcharge on top of the standard rates. Buyers who are not UK resident pay a further 2%.
Legal Costs in Property Transactions
Legal fees depend on the type of transaction and the work it requires. We confirm our fees in writing before we start.
When buying, you should budget for:
- Our legal fee: from £900 + VAT for a purchase, plus £250 + VAT for a leasehold or new build property.
- HM Land Registry fee: set on a scale according to the price.
- Search fees: £182.86 on a typical purchase.
- Bank transfer fee: £40 + VAT per transfer.
Our fee for a sale starts from £895 + VAT. For an estimate based on your transaction, use our Conveyancing Fees Calculator.
Stamp Duty for First-Time Buyers
First-time buyer relief applies where every buyer is a first-time buyer and the property will be their main residence:
- No Stamp Duty on the first £300,000.
- 5% on the portion from £300,001 to £500,000.
- If the price is above £500,000, the relief is not available and standard rates apply to the whole price.
Stamp Duty on Buy-to-Let & Second Homes
If you are buying an additional residential property, such as a buy-to-let or second home, a 5% surcharge applies on top of the standard rates:
- Up to £125,000: 5%
- £125,001 to £250,000: 7%
- £250,001 to £925,000: 10%
- £925,001 to £1.5m: 15%
- Over £1.5m: 17%
Investors should also consider the Capital Gains Tax position when a rental property is later sold.
When & How to Pay Stamp Duty
The SDLT return must be filed and the tax paid within 14 days of completion. As your conveyancer, we submit the return and pay the tax to HMRC from funds you provide before completion. Late filing or payment leads to penalties and interest.
Advice on Your Purchase
Our conveyancing team, accredited under the Law Society Conveyancing Quality Scheme, acts for first-time buyers, home movers and investors. Please contact us for a quotation.