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  • Tax

    Stamp duty surcharge on 2nd property < £40K?

    I have another Topic on the go and there seems to be some mixed opinions on Stamp Duty.

    If i buy a second or subsequent home under £40,000 it is my understanding that no Stamp Duty is charged.

    I have Googled this and it does seem to be correct however i have had one or two LandLords say otherwise on another topic.

    Can anybody who purchases £40k and under properties confirm this?

    Thank You.

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    HMRC:     *Transactions under £40,000 do not require a tax return to be filed with HMRC and are not subject to the higher rates.

    https://www.gov.uk/government/consultati...properties

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    If this is a second property then my understanding is that there stamp duty to pay unless this is a commercial property.

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    So basically have to pay as this is seen as the 'second' property?

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    My understanding is properties up to £40,000 are free of all SDLT, as that's what the HMRC say: see the comment below the table in para 2.1

    https://www.gov.uk/government/consultati...properties

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    If you pop the numbers into the .gov SDLT calculator it returns £0 SDLT whether purchasing as an individual or company. I would guess that's correct unless a qualified tax advisor knows of an exception.

    https://www.tax.service.gov.uk/calculate...ax/#/intro

    Wales and Scotland have the same result for LTT and LBTT

    https://lttcalculator.wra.gov.wales/

    https://www.revenue.scot/land-buildings-...calculator

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    Hi Gary

    Have you ticked all the right boxes. If you buy a second residential property there's 3% stamp duty on the whole amount then the normal banding. So this would be 3% of 40k. I'm not an accountant and anything that means less tax leggitamately is great

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    Yes, I ticked all the right boxes... And it's not often I get to say that!

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     Every source I find says that under £40K you are exempt from SDLT. From an article from Zoopla 'For example you won’t pay the 3% Stamp Duty surcharge on additional homes that cost less than £40,000, or on caravans, mobile homes and houseboats. '
    Read more at https://www.zoopla.co.uk/discover/buying...kwGTZQX.99

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    Is is what  my tax lecturer (who is also a 'tax man') said:

    As long as it is under £40K then you will not pay SDLT.  If it is over £40k then you will pay a premium of 3% over the usual rate.

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