Buy to Let New Stamp Duty

New buy-to-let stamp duty: How much will you pay?

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Stamp duty rates will be three percentage points higher for buy-to-let investors and holiday home buyers from April 2016.

 

Property value  Stamp duty rate for owner-occupiers  Stamp duty rate for second property/buy-to-let 
(No duty payable properties costing under £40,000)
Up to £125,000 Zero 3%
The next £125,000 (the portion from £125,001 to £250,000) 2% 5%
The next £675,000 (the portion from £250,001 to £925,000) 5% 8%
The next £575,000 (the portion from £925,001 to £1.5 million) 10% 13%
The remaining amount (the portion above £1.5 million) 12% 15%

The higher rates will not apply to purchases of caravans, mobile homes or houseboats, or to corporate entities or funds making significant investments in residential property.

 

Value of second property/buy to let (£)  Current SDLT (£)  SDLT from 1 April 2016 (£)  Increase in tax (£) 
100,000

150,000

Nil

500

 

3,000

5,000

3,000

4,500

175,000

250,000

1,000

2,500

6,250

10,000

5,250

7,500

350,000 7,500 18,000 10,500
450,000 12,500 26,000 13,500

 

Buy-to-let investors will pay thousands of pounds extra in tax when they buy a property following the announcement of special “landlord” stamp duty tax rates applying from April 2016.

Stamp duty rates will be three percentage points higher for buy-to-letters than those buying a property to live in from April next year.

It means the tax bill on a buy-to-ley property costing £250,000 will jump from £2,500 to £8,800. More examples are in the table below.

The same increased stamp duty rate applies to buying other second properties, such as holiday homes, in which the owners do not intend to live full-time

buy-to-let-stamp-duty

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