A Guide to Stamp Duties

There are three types of Stamp Duty:

• Stamp Duty Land Tax (SDLT) – which applies to land transactions
• Stamp Duty Reserve Tax (SDRT) – which applies to sales of securities on the stock market; and
• Stamp Duty – which applies to the sale of shares and securities.

In all cases the purchaser must pay the duty based on the price paid or value if not paid in cash.

Stamp duty land tax

Stamp duty land tax is a tax on the acquisition of interests in UK land including houses, flats, other land and on both the grant and assignment of leases.

The purchaser is responsible for the payment of the tax and filing of the land transaction return, although is normally done by their solicitor on their behalf. The return should be filed within 30 days of the transaction.The 30-day filing window is expected to be reduced to 14 days in respect of land transactions with an effective date on and after 1 March 2019.

SDLT is payable whether or not the parties to the transaction are based in the UK and whether or not a document is used. The consideration on which SDLT is paid is money or money’s worth and where consideration is contingent it is payable on the assumption that the contingent consideration will be payable.

SDLT is also charged on any VAT included in the transaction.

If you are buying land or property, the amount of SDLT payable is dependent upon the purchase value as shown in the following table with a higher starting point for land in designated disadvantaged areas…

From 4th December 2014, Stamp Duty Land Tax (SDLT) will be charged at each rate on the portion of the purchase price which falls within each rate band.