Q&A – Stamp Duty Land Tax for First Time Buyers


If you’re buying a home for the first time SDLT is something you won’t have encountered before. Here are some of the most common questions and answers.

What is SDLT?

Stamp Duty Land Tax is often just referred to as Stamp Duty. It is a tax payable when you buy a property. It applies whether the property is leasehold or freehold.

How much is it?

If you have never owned your own home, you pay no stamp duty for the first £300,000 if the purchase price is less than £500,000. You then pay 5% on anything between £300,000 and £500,000.

If the property is worth more than £500,000 the standard SDLT rates apply (no first time buyer relief).

If my spouse owns a property but I don’t, am I a first time buyer?

Probably not. Property within a marriage or civil partnership is deemed to be jointly owned for the purposes of SDLT.

I’m using a shared ownership scheme, what stamp duty do I pay?

The SDLT rules can become complicated based on whether you can, and intend to, gradually increase your share of the ownership and whether you are able to buy the freehold.

You can pay SDLT in a single upfront payment or in stages as you increase your share. If you have to pay a high rent for the part of the property you don’t own this can attract additional SDLT.

Do I pay SDLT for a leasehold property?

Yes. In most cases SDLT will be calculated on the price paid for the lease on the same basis as for freehold properties. There may be additional SDLT if there is rent to pay over the life of the lease.

How do I pay it?

In most cases your conveyancing solicitor will complete the SDLT tax return and pay the tax on your behalf within the specified time. The cost of the SDLT will be added to the fee.

If you have any questions about Stamp Duty or any other aspect of buying a house, please contact the friendly team at PowellsLaw.

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