Stamp Duty is the tax you pay when you buy property or shares. You pay 'Stamp Duty Land Tax' when you buy property like houses, flats, other buildings and land. If the purchase price is £125,000 or less (£250,000 or less for first-time buyers) you don't pay any Stamp Duty Land Tax at all. If it's more than £125,000 (£250,000 for first-time buyers), you pay a percentage of the whole purchase price.

RATES OF STAMP DUTY LAND TAX

Residential property - purchase price Rate of Stamp Duty Land Tax Rate of SDLT for First Time Buyers up to £125,000 0% 0% Over £125,000 to £250,000 1% 0% (see note below) Over £250,000 to £500,000 3% 3% Over £500,000 4% 4%

You should check current rates of Stamp Duty Land Tax on the HM Revenue & Customs (HMRC) website, here. Note that there are special rules for leases of less than 21 years.

First Time Buyers

The first time buyer's £250,000 threshold applies from 25 March 2010 up to 24 March 2012 inclusive.

Property in disadvantaged areas

If you're buying a property an area designated by the government as 'disadvantaged', you don't pay any Stamp Duty Land Tax if the purchase price is £150,000 or less.

Zero carbon homes

A zero-carbon home must be ‘zero carbon’ over the course of the year. The house can be connected to mains electricity and gas but needs to have sufficient additional renewable power to cover the average consumption of a house over a year.

In order to achieve this, the fabric of the building will have to be insulated and built to very high standards and the house will need to incorporate renewable energy technologies.

The 2007 Budget announced that relief from Stamp Duty Land Tax for zero-carbon homes would be introduced from 1 October 2007.  All qualifying houses under £500,000 will be exempt and houses over £500,000 will have their SDLT bill reduced by £15,000.

For more information, click here to find out more from the Government’s own web-site (opens a new window).