Gerry Surtees Chartered Tax Adviser

New SDLT Rules

The chancellor announced a welcome change to the way Stamp Duty Land Tax (SDLT) is calculated on residential property in the Autumn Statement 2014, bringing a SDLT cut for 98% of the people who pay it.

What is changing?

Under the old rules, you had to pay tax at a single rate on the entire property price.  This created illogical jumps in the amount of tax due near the thresholds.  For example, if you purchased a house for £250,000, you would pay SDLT at 1% (£2,500), whereas if the house was purchased for only £50 more, at £250,050, you would pay SDLT at 3% (£7,502). 

Under the new rules, you will only pay the rate of tax on the part of the property price within each tax band – similar to income tax, with 0% SDLT payable on the first £125,000 of the value of the property.

New SDLT rates

HMRC have a useful online calculator to help you work out how much stamp duty you would have to pay under these new rules.

Example


The new rules started at 00:00 on 4th December 2014, and only apply to residential property.

If you have any questions on the new Stamp Duty rules, please don't hesitate to contact us.