Stamp Duty Calculator

RWinvest Stamp Duty Calculator and Guide to Stamp Duty for Investors

If you’re new to property investment, Stamp Duty is most likely a term you will have heard a lot about. Like many other property-related terms, if you’re new to the world of property investment, you may not be familiar with buy to let Stamp Duty, how to calculate it, and how much the taxes for Stamp Duty on an investment property will cost you. Understanding Stamp Duty and any other fees involved with buy to let is, however, one of the most crucial tips when getting started in property investment.

In this detailed guide, we bring you information on Stamp Duty for investors, along with tips on how to calculate Stamp Duty with our Stamp Duty calculator. Whether you’re a homeowner or buy to let investor, you can learn everything from how much you will owe in Stamp Duty, to how long you have to pay your Stamp Duty tax. Scroll through this article to read more and become an expert on all things buy to let Stamp Duty.

Buy to Let Stamp Duty Calculator

Want to know how much Stamp Duty tax you will have to pay on your next property?  If you’re buying a single or additional property or you’re a first-time buyer, we can work out your Stamp Duty rates in seconds with our Stamp Duty calculator. Use our specially devised Stamp Duty calculation formula to work out how much Stamp Duty tax you could be charged on your next property investment.

The Stamp Duty Land Tax (SDLT) calculator takes into account your property price and whether you’re purchasing a buy to let or buy to live property, showing a full breakdown of the taxable amounts. If you’re a first-time investor who’s wondering how to calculate Stamp Duty, our new Stamp Duty calculator can work out your Stamp Duty fees in a matter of seconds.

Try Our Free Stamp Duty Calculator

Stamp Duty due:
Effective Rate: 1%

See Full Calculation below:

Tax Brand % Taxable Sum Tax
less than £125k 0
£125k to £250k 2 £125,000 £2,500
£25k to £925k 5 £0 £0
£925k to £1.5m 10 £0 £0
rest over £1.5m 12 £0 £0

Try Our Free Stamp Duty Calculator

Stamp Duty due: £2.500
Effective Rate: 1%

See Full Calculation below:

Tax Brand % Taxable Sum Tax
less than £125k 0 £0 £0
£125k to £250k 2 £125,000 £2,500
£25k to £925k 5 £0 £0
£925k to £1.5m 10 £0 £0
rest over £1.5m 12 £0 £0
Stamp Duty due: £2.500
Effective Rate: 1%

See Full Calculation below:

Tax Brand % Taxable Sum Tax
less than £125k 0 £0 £0
£125k to £250k 2 £125,000 £2,500
£25k to £925k 5 £0 £0
£925k to £1.5m 10 £0 £0
rest over £1.5m 12 £0 £0
Stamp Duty due: £2.500
Effective Rate: 1%

See Full Calculation below:

Tax Brand % Taxable Sum Tax
less than £125k 0 £0 £0
£125k to £250k 2 £125,000 £2,500
£25k to £925k 5 £0 £0
£925k to £1.5m 10 £0 £0
rest over £1.5m 12 £0 £0

Commonly Asked Questions About Stamp Duty

To help you understand Stamp Duty for investors a little better, we’ve answered some of the most commonly asked questions about buy to let Stamp Duty rates, how to calculate Stamp Duty in the UK, and offered information on rules for new Stamp Duty on buy to let.

Stamp Duty is a tax that those in England or Northern Ireland are liable to pay after purchasing a residential property or piece of land, or a second home such as a buy to let investment property. The tax applies to both freehold and leasehold properties, whether or not you’re using a mortgage to pay for the property.

You only have to pay Stamp Duty when buying a property over a certain amount, and the higher the cost of the property, the more Stamp Duty you’ll have to pay. In Scotland and Wales, Stamp Duty tax laws don’t apply. Instead of Stamp Duty, Scotland has its own distinct Land and Buildings Transaction Tax with different rates, and Wales also uses a differently tiered system, so be sure to look into this further if purchasing property within these regions.

There are some reasons why you might not need to pay Stamp Duty tax. First-time buyers, for instance, are exempt from paying Stamp Duty on properties worth less than £300,000. If you’re a buy to let investor who owns their own home, you can avoid Stamp Duty tax on purchases worth less than £40,000. Certain types of properties such as houseboats, mobile homes and caravans are also exempt from Stamp Duty.

The threshold for Stamp Duty tax is £125,000 on residential properties or land purchases. For those buying a second home, however, the threshold is lowered to £40,000. This means that if you’re investing in a buy to let property, you will most likely be required to pay Stamp Duty as most investment properties are priced higher than £40,000.

So how much is Stamp Duty in the UK? The amount of Stamp Duty that you will pay depends on the purchase price of the property. For instance, for a buy to let property worth £130,000, you would need to pay Stamp Duty of 3.08% which would equal £4,000. As a rule of thumb, use this helpful Stamp Duty table below to understand the amount of Stamp Duty you may need to pay.

How Much Stamp Duty Do You Pay

The number of properties you own impacts the rate of Stamp Duty paid on your buy to let investment. For instance, if you’re wondering how much Stamp Duty on a 250k property that you’ll need to pay, the answer would be £10,000. If you bought two properties worth the same amount, you would pay £20,000 in total on Stamp Duty tax.

Stamp Duty can be calculated in two ways. You can follow the above guide to find out what percentage of Stamp Duty you’ll need to pay based on your property price and calculate the amount yourself, or you can use a Stamp Duty calculator for BTL or residential properties. With our buy to live and buy to let Stamp Duty calculator, all you need to do is enter your property price, and we will calculate Stamp Duty for you.

After you’ve purchased a property, your Stamp Duty payment will start immediately. You’re required to pay your Stamp Duty fees within 14 days of buying a property. Therefore, you should use our buy to let and residential Stamp Duty calculator to work out how much this is going to be in advance to ensure you have the correct amount available.

What is Stamp Duty?

Stamp Duty is a tax that those in England or Northern Ireland are liable to pay after purchasing a residential property or piece of land, or a second home such as a buy to let investment property. The tax applies to both freehold and leasehold properties, whether or not you’re using a mortgage to pay for the property.

You only have to pay Stamp Duty when buying a property over a certain amount, and the higher the cost of the property, the more Stamp Duty you’ll have to pay. In Scotland and Wales, Stamp Duty tax laws don’t apply. Instead of Stamp Duty, Scotland has its own distinct Land and Buildings Transaction Tax with different rates, and Wales also uses a differently tiered system, so be sure to look into this further if purchasing property within these regions.

Can Stamp Duty be Avoided?

There are some reasons why you might not need to pay Stamp Duty tax. First-time buyers, for instance, are exempt from paying Stamp Duty on properties worth less than £300,000. If you’re a buy to let investor who owns their own home, you can avoid Stamp Duty tax on purchases worth less than £40,000. Certain types of properties such as houseboats, mobile homes and caravans are also exempt from Stamp Duty.

What is the Stamp Duty Threshold?

The threshold for Stamp Duty tax is £125,000 on residential properties or land purchases. For those buying a second home, however, the threshold is lowered to £40,000. This means that if you’re investing in a buy to let property, you will most likely be required to pay Stamp Duty as most investment properties are priced higher than £40,000.

How Much is Stamp Duty - How Much Stamp Duty Do You Pay?

So how much is Stamp Duty in the UK? The amount of Stamp Duty that you will pay depends on the purchase price of the property. For instance, for a buy to let property worth £130,000, you would need to pay Stamp Duty of 3.08% which would equal £4,000. As a rule of thumb, use this helpful Stamp Duty table below to understand the amount of Stamp Duty you may need to pay.

How Much Stamp Duty Do You Pay

The number of properties you own impacts the rate of Stamp Duty paid on your buy to let investment. For instance, if you’re wondering how much Stamp Duty on a 250k property that you’ll need to pay, the answer would be £10,000. If you bought two properties worth the same amount, you would pay £20,000 in total on Stamp Duty tax.

How to Calculate Stamp Duty - How is Stamp Duty Calculated?

Stamp Duty can be calculated in two ways. You can follow the above guide to find out what percentage of Stamp Duty you’ll need to pay based on your property price and calculate the amount yourself, or you can use a Stamp Duty calculator for BTL or residential properties. With our buy to live and buy to let Stamp Duty calculator, all you need to do is enter your property price, and we will calculate Stamp Duty for you.

When Does Stamp Duty Start?

After you’ve purchased a property, your Stamp Duty payment will start immediately. You’re required to pay your Stamp Duty fees within 14 days of buying a property. Therefore, you should use our buy to let and residential Stamp Duty calculator to work out how much this is going to be in advance to ensure you have the correct amount available.

Stamp Duty for Investors

Stamp Duty for Investors – Things You Need to Know

Residential Stamp Duty Vs Buy to Let Stamp Duty Rates

It’s important to ensure your buy to let property falls into the residential category before going ahead and reading the rates. Properties that aren’t residential include any that are utilised for commercial purposes or land that is used for agriculture or forests.

Where residential and non-residential properties are combined – for example, if buying a hairdresser with a flat above as a single unit – this would be considered as mixed-use land or property. Anything other than these abnormalities is considered to be a residential property.

For buy to let residential investments, the Stamp Duty thresholds are slightly different from the standard bands. Non-investor homeowners don’t have to pay Stamp Duty on anything up to £125,000, whereas buy to let investors must start paying the tax from £40,000. The tax rate is calculated differently between each value band, and the applicable rate of Stamp Duty is due on each portion of the price.

Land and Buildings Transaction Tax in Scotland and Wales

The Scottish government reformed laws to introduce the land and buildings transaction tax which takes Stamp Duty’s place. While still a lump-sum tax paid on property and land, it is merely the Stamp Duty thresholds which make it different. Here are the rates:

Stamp Duty Scotland

*For properties below £40,000, only the lower rate applies.

 

Wales also operates a very similar system to that in England and Northern Ireland but with varying rates:

Stamp Duty Wales

Start Your UK Investment Journey Today

View Properties

First Time Buyer Stamp Duty

With UK Stamp Duty, first-time buyers benefit from some alleviations. But first of all, let’s qualify who a first-time buyer actually is. A first-time buyer is someone who has never owned or inherited a property before.

This means that regarding first time relief on Stamp Duty, buy to let investors are not eligible if they already own their personal home. To reiterate, initial buy to let properties don’t count for first-time buyers if they are being purchased as a secondary property. However, if you have never previously bought a property and your first purchase is a buy to let, you will unfortunately still have to pay the standard buy to let Stamp Duty tax rates.

For first time buyers of non-buy to let property, new laws state that you don’t have to pay Stamp Duty on any property up to the value of £300,000. After this, the portion of money between £301,000 and £500,000 will be taxed at a discounted rate. 5% Stamp Duty tax will be paid on every proportion between these amounts. After £500,000 Stamp Duty rates follow the usual pattern.

Buy to Let Guide

The Difference Between Freehold and Leasehold Rates

Freehold is when a property and the land that it is built upon are owned outright. The owner does not have to pay any service charge or ground rent. You are responsible for maintaining the building.

Leasehold is when tenants lease the property from a freeholder. You own the property with the freeholder during your lease period. Leaseholders have to pay service charge and ground rent for maintenance of the building, subject to restrictions by the freeholder.

Please note that Stamp Duty on a property in new or existing freehold and leasehold agreements is owed. Freeholds follow the standard rates in relation to house prices, but leasehold Stamp Duty is paid on the price of the lease. When rent amounts to more than £125,000, a 1% tax must be paid on any portions of the price after this amount.

financial sector Leeds

How and Where to Pay

Paying Stamp Duty is easy when you know how. A Stamp Duty land tax return should be sent to HMRC and paid within 14 days of completion of the property. Completion is when all contracts have been signed off, and you get your keys to enter the property. This is typically when you need to start thinking about paying Stamp Duty. If you don’t pay within this time frame, you could be subject to interest rates or fines.

When using solicitors, conveyancers or agents to assist in property transactions, they may file an SDLT return to HMRC themselves and pay the Stamp Duty tax amount upon completion on the property on the buyer’s behalf. The tax would then be added into the solicitor fees to be paid by the buyer.

Liverpool Investment Opportunities

Adding Stamp Duty to a Mortgage?

If you’re worried that you can’t cover the cost of Stamp Duty, it’s possible to borrow more money when you take out your mortgage. This way, you can use a loan to pay Stamp Duty tax’s substantial rates.

However, the downside of doing this is that after a long repayment period, the initial price of Stamp Duty will accumulate interest and cost you more money in the long run.

Be Aware of Changes to Rates

Rates and reliefs are known to change frequently. For example, the Stamp Duty changes in 2016 saw significant alterations to how the property market works. Our buy to let and residential Stamp Duty calculator does all of the hard work for you by implementing the most up to date Stamp Duty rates.

Stamp Duty on Investment Property for Overseas Investors

It is possible that overseas investors may be required to pay a Stamp Duty surcharge. The Conservative Party unveiled these plans at the end of 2019, which would require non-UK tax residents to pay a surcharge of 3%. If these changes were to come into effect, it would mean that on the sale of a property worth £1.5 million, an overseas investor would pay £183,750 in Stamp Duty while a UK resident buying their first home for the sale price would pay £93,750. It’s not yet clear whether or not these surcharge rates on Stamp Duty for investors from overseas will be implemented.

If you have any further questions about buy to let Stamp Duty rates or you’ve used our Stamp Duty calculator on a BTL investment listed on our website and want to find out more, please don’t hesitate to get in touch. We can offer any necessary guidance and help you move forward with your buy to let investment.

 If you need further information on Stamp Duty tax laws, it’s worth seeking the help of a financial adviser who can offer you some detailed advice.

Start Your UK Investment Journey Today

View Properties