In the last issue, Lan Shajun introduced to all British real estate buyers the latest policy of British inheritance tax, and everyone’s tax on buying a house in the UK The question is of great interest.
In this issue, I will introduce to you the largest proportion required to buy a British house. A kind of tax——stamp tax-how should it be calculated?And under what circumstances can part of the stamp duty be exempted?
1: What is stamp duty?
Stamp Duty Land Tax (SDLT) is a levy on the purchase of property in England and Northern Ireland. Kind of tax.Whether you are a British resident or a non-British resident buying a house in the UK, you need to pay stamp duty (SDLT, Stamp Duty Land Tax) to the tax bureau.
At the same time, the specific amount we need to pay depends on whether the land or property we purchase is used as a residential property or a non-residential or mixed use.Stamp duty is charged at different rates based on the purchase price of the property. There are many stamp duty tax levels, and the tax rates range from low to high.
2: When is stamp duty paid?
Stamp duty needs to be paid within 14 days after completing the property purchase.The buyer's lawyer will also clearly list the stamp duty that needs to be paid in the delivery list, and will send an application form to the British Land Registry on behalf of the buyer 14 to pay the tax and register the property title within 14 days.
Since 2014, stamp duty has become a progressive tax, with increases in tax rates applying Between specific stamp duty thresholds, rather than the final purchase price that applies to the property.
3: What is the stamp duty rate?
The current stamp duty threshold in England and Northern Ireland will be increased from the original 125,000 To 25 million pounds.The threshold for first-time buyers has been increased from £113.3 million to £42.5 million.At the same time, the upper limit on the price of a first home that can benefit from this reduction has also increased from the original 50 million pounds to 62.5 pounds.
In order to make it easier for everyone to see, the editor has compiled the different tax rates of stamp duty for different housing prices.
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4: UK real estate What are the categories of home buying groups? Buying a home for exchange); investment buyers (second home, rental, vacation rental, etc.); non-UK resident buyers
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First home buyer:
First-time buyers will need to submit special documents to declare that they have never owned a property in the UK or abroad. First-time homebuyers codes and stamp duty returns are required to enjoy stamp duty reductions for properties below a certain value
First-time homebuyers do not have to pay. Stamp duty on properties less than £425 million, the upper limit of stamp duty exemption is no more than 625£, anything exceeding 625 million. Purchases in pounds will be subject to stamp duty at the normal stamp duty rate on the entire purchase price
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Ordinary home replacement buyers:
#{ 76 }There will be no higher stamp duty rates if the household decides to change their main residence. Even if someone owns two properties in the short term, they can claim a refund of the higher stamp duty rate once they sell their previous main residence. The final stamp duty will be levied at the normal rate
How to get tax refund for ordinary house purchasers#{ 85 }
The government stipulates that the allowed property sales period is three years. Although the stamp duty on new properties is initially based on a lower A high tax rate is charged, but if the old house is sold within three years, you can apply for a stamp duty refund. At the same time, the refund must be filled in through HMRC. Form to apply for "A higher rate for repayment of additional properties".Stamp duty refunds must be claimed within 12 months of the sale of the previous principal residence.
Definition of principal residence:
Classifying a property as a principal residence may require evidence to confirm the following criteria:
#{ 6}1.The property is a place where the owner or his family spend time2. If the owner has school-age children, the school they attend
3.The address where the owner is registered to vote #. {22}
4.Where the owner works
Other factors may also be taken into consideration, including the extent of the property and the correspondence address provided to the third party
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Investment sellers:
The corresponding property types include buy-to-let investments and second homes. Land and other types of property are generally not considered when determining ownership of additional property for stamp duty purposes. From March 4, anyone purchasing additional property will have to pay an increase in stamp duty and will need to pay an additional amount 3% stamp duty surcharge
Non-UK resident buyers: #{90 }
from2021year#{ From 102}2 anyone living overseas buying a property in England or Northern Ireland will need to pay an additional 2%2% Non-UK resident stamp duty. Non-UK residents refer to (including British expatriates working and living overseas or in the UK within the 12 months. Those staying less than 183 days) will be subject to non-UK resident stamp duty.
When a buyer purchases a UK property, if the buyer resides in the UK within one year after purchasing the property Tax refund is available after 183 days.
Have you noticed how tedious it is to calculate stamp duty after reading this? not accurate enough.
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Lan Shajun thoughtfully recommends a very useful stamp duty calculator to everyone.
After reading this, you already feel how tedious it is to calculate stamp duty. If you feel that you can calculate it yourself not accurate enough.Then Lan Shajun recommends a very useful stamp duty calculator to everyone.
WeChat search applet“# {24}Finding a house in England”, click”Tax calculation#{ 34}", you can know exactly how much stamp duty you need to pay when buying a house!
Give an example.
For example, purchase 👇
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400,000 house: the total stamp duty payable by the first owner-occupied local buyer£0VSthe non-UK resident buyer who invests is#{71 }£27500
60 Thousand pounds house: first home owner-occupied local buyer£8750VSnon-investment The total stamp duty payable by UK resident buyers is £47500
80 million pounds for a house: first owner-occupier local buyer £27500VSThe total stamp duty payable by non-UK resident buyers who invest is £67500
After clarifying the content of stamp duty, then You already know half of the UK property tax issues!
Remember to continue to pay attention"Looking for a house in England#{101 }” Official account.
In the next issue, Lan Shajun will share with all British real estate buyers how to calculate the cost of buying a British house. Other taxes involved include municipal tax, capital gains tax, and personal income tax.
