Can I pay less stamp duty?


Stamp Duty is a tax you pay to HMRC when you buy a house that costs more than £125,000.

There’s a sliding scale so the more expensive your house, the more you will end up paying. 

Latest media reports suggest the government may be planning a cut for first time buyers in the November 2017 budget.

But the short answer is that there’s no way around it if you’re buying a house that reaches the threshold.

Richard Bocock, network property sales manager for The Nottingham Estate Agency and Harrison Murray said: “Stamp duty is a cost that needs to be considered whether you are buying your first home or considering moving house.

“When negotiating on the sales price with the seller, buyers may ask for the cost of stamp duty to be considered within their offer price, and if you are purchasing a new build property sometimes developers will offer incentives which include stamp duty payment, in reality this is shown as a discount on the sale price.

“The stamp duty liability is always based on the value of the house.

“The number of available properties is at its lowest ever levels, and whilst demand remains high, prices are holding up. There are other costs involved if you want to move house – and stamp duty may not be the biggest consideration when you want to make a move.”

Stamp Duty Land Tax was introduced in December 2003. This is what you will have to pay:
  • Purchase price of up to £125,000: Zero
  • 2% on the next £125,000 (between £125,001 and £250,000) 
  • 5% on the next £675,000 (between £250,001 and £925,000) 
  • 10% on the next £575,000 (between £925,001 and £1.5m)
  • 12% on anything above £1.5 million.
  • It rises to a new, higher rate if you’re buying a second property.
If the purchase price is below £125,000 you still need your solicitor to submit a return even though you won’t need to pay any stamp duty. It is an offence to avoid stamp duty and you can be charged a £100 penalty on top of what you owe in tax. 

Patrick Bell, who recently bought a new-build house in the Aspley area with his partner said: “We didn’t know about stamp duty until the mortgage adviser told us about it. I was a bit out of the loop having not bought a property for about 20 years.

“It’s paid through your solicitor as part of the overall bill but it comes off the bottom line of savings and not off your mortgage. It’s quite a lot and could be more than your house deposit.

“In our case the house builder made a contribution as part of the cost of the new property.”

These are some instances when you may not have a bill for Stamp Duty:
  • Buying a house for less than £125,000;
  • If you itemise some of the contents’ value to bring down the price;
  • Transferring deeds as a gift or in your Will would stop the recipient being liable;
  • In the case of a transfer of part of the value of a house in divorce, no stamp duty is payable.
Visit the gov.uk website for more on situations where stamp duty may not be payable.

Can I pay less Stamp Duty? 


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