From 4 December, stamp duty land tax (SDLT) on residential property has been changed from the ‘slab’ approach – where an extra £1 of purchase price could add £40,000 to the tax bill – to a tiered, income tax style of approach, with each of five slices of value attracting a different rate (see below). The end result is that 98% of home-buyers will pay less or the same amount in SDLT, while 2% – those buying properties valued at over £937,500 – will pay more.
|Band of Residential Property Value (£)||SDLT Rate (%)|
|Up to 125,000||0|
|1,500,001 & over||12|
A property valued at £650,000 would be subject to stamp duty land tax of:
Under the old slab SDLT regime, a flat rate of 4% would have applied to the whole value, giving a tax bill of £26,000.