Stamp Duty Glossary
Clear definitions for all the terms you'll encounter when dealing with property taxes.
Tax Types
SDLT(Stamp Duty Land Tax)
The property transaction tax paid in England and Northern Ireland when buying property over the nil-rate threshold.
LBTT(Land and Buildings Transaction Tax)
Scotland's equivalent of stamp duty, administered by Revenue Scotland. Has different rates and thresholds to SDLT.
LTT(Land Transaction Tax)
Wales's equivalent of stamp duty, administered by the Welsh Revenue Authority. Has different rates and no first-time buyer relief.
Thresholds
Nil-Rate Band
The portion of a property purchase price on which no stamp duty is charged. Currently £125,000 for standard buyers in England.
Surcharges
Additional Property Surcharge(Higher Rates for Additional Dwellings)
An extra 5% charged on the entire purchase price when buying a second home, buy-to-let, or other additional property.
ADS(Additional Dwelling Supplement)
Scotland's equivalent of the additional property surcharge. Currently 6% on additional property purchases.
Non-Resident Surcharge
An additional 2% charged on property purchases by non-UK residents (those who have not been UK resident for 183 days in the previous 12 months).
Reliefs
First-Time Buyer Relief
A relief for first-time buyers providing a higher nil-rate threshold (£300,000) and no stamp duty on properties up to this amount.
MDR(Multiple Dwellings Relief)
A relief that reduces stamp duty when purchasing multiple residential properties in a single transaction, calculated on the average property value.
Calculation
Chargeable Consideration
The amount on which stamp duty is calculated, typically the purchase price but can include other payments like assumption of debt.
Linked Transactions
Two or more transactions between the same buyer and seller (or connected persons) that are treated as a single transaction for stamp duty purposes.
Net Present Value (NPV)
The method used to calculate stamp duty on commercial lease transactions, based on the total rent over the lease term discounted to present value.
Effective Rate
The actual percentage of the property price paid in stamp duty, calculated by dividing total tax by purchase price. Always lower than the highest marginal rate.
Marginal Rate
The rate applied to a specific portion of the property price within a particular band. Stamp duty uses a progressive marginal rate system.
Process
Effective Date
The date from which stamp duty becomes payable, usually the date of completion when the transaction is completed.
Completion
The final stage of a property purchase when legal ownership transfers and the balance of the purchase price is paid.
SDLT Return
The form submitted to HMRC declaring the stamp duty due on a property transaction, must be filed within 14 days of completion.
Transactions
Transfer of Equity
A transfer of ownership share in a property, such as adding or removing someone from the property title.
Ownership
Beneficial Interest
A share in a property that entitles the holder to benefit from it, even if they're not named on the title. Relevant for determining first-time buyer status.
Main Residence(Principal Private Residence)
The property where you live as your primary home. Important for determining if the additional property surcharge applies.
Quick Acronym Reference
SDLT
Stamp Duty Land Tax
LBTT
Land & Buildings Tax
LTT
Land Transaction Tax
ADS
Additional Dwelling Supplement
MDR
Multiple Dwellings Relief
FTB
First-Time Buyer
BTL
Buy-to-Let
NPV
Net Present Value
HMRC
HM Revenue & Customs
How It's Calculated
Step-by-step guide to understanding the tiered rate system.
All Guides
In-depth guides for every buyer type and situation.
Common Questions
Answers to frequently asked stamp duty questions.
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