What is stamp duty?

Stamp Duty is primarily a tax on documents. For the most part, these are documents used in the transfer of property or are documents which create rights for the parties. For example, you pay stamp duty when you purchase a house on the document of transfer, called the conveyance.

How much must I pay?

Conveyance on sale of property e.g. houses and land:
The amount of duty you pay depends on how much you paid for the property and whether the property is residential or non-residential. The first column refers to the purchase price, the second, the rate of duty on non -residential property and the third, the rate of duty on residential property.

Cost of Property Rates of Duty Non-Residential Rates of Duty Residential
Does not exceed £5,000 exempt exempt
£5,001 - £10,000 1% exempt
£10,001 - £15,000 2% exempt
£15,001 - £25,000 3% exempt
£25,001 - £50,000 4% exempt
£50,001 - £60,000 5% exempt
£60,001 - £100,000 6% 3%
£100,001 - £170,000 6% 4%
£170,001 - £250,000 6% 5%
£250,001 - £500,000 6% 7%
£500,001 + 6% 9%


Conveyance on sale of shares:
Where the property is shares in a company, you pay duty at the rate of 1 per cent. of the purchase price. There is no exemption threshold.

Mortgage:
Where the total amount borrowed does not exceed £20,000 there is no duty payable. In excess of £20,000, duty is payable at a rate of £1 per £1,000 of the total sum borrowed.

Lease:
Leases of houses or apartments are in general exempt from duty unless the rent exceeds £6,000 per year. In all other cases duty is payable in respect of both the rent and the premium. The main rates of duty on rent are:
1 per cent. of the annual rent where the term of the lease does not exceed 35 years.
6 per cent. of the annual rent where the term exceeds 35 years but does not exceed 100 years.
12 per cent of the annual rent where the term exceeds 100 years.
Where a premium or a lump sum is paid for a lease it is liable to the same duty as would apply to a conveyance on sale of property for that sum. This is in addition to the duty payable on the rent.

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