Quick Guide To New Stamp Duty Charges

Posted by Mark on 20th February 2016

Landlords are soon to be hit with new stamp duty changes from April 1st 2016 when an additional 3% stamp duty charge is to be introduced. This increase, which aims to free up housing for first time buyers, will result in adding thousands onto buy-to-let property transactions. 

How Will This Affect Me?

These additional charges apply above the current stamp rates and are illustrated in the HMRC table below:


Band                                          Existing residential SDLT rates                 Proposed additional rates for landlords

£0 - £125k                                  0%                                                                  3%

£125,001 - £250k                       2%                                                                  5%

£250,001 - £925k                       5%                                                                  8%

£925,001 - £1.5m                      10%                                                                13%

£1.5m +                                     12%                                                                15%


For example, anyone buying a £250,000 second home or buy to let before April 2016 pays stamp duty of £2,500. This is based on paying 0% on the first £125,000 of the property value and 2% on the portion between £125,001 and £250,000. But from April 2016, landlords will have to pay 3% for the first £125,000 and 5% instead of 2% on the amount between £125,001 and £250,000, meaning that they will have to pay £10,000 in total.

So a landlord would end up paying four times more than a private purchaser in this example.

It is not just landlords that will be affected by these new charges but anyone owning a second home, whether it's parents buying a property for their children, or a couple purchasing a home together where one already owns a property.

Exemptions To The Rule

As always, there are exemptions to the rule. The types of property that won't fall under the new stamp duty charges are:

  • Caravans and houseboats
  • Properties worth less than £40,000.00
  • Charities and registered social landlords
  • Multiple purchases (companies already owning 15 properties)

There are currently many landlords trying to complete purchases before the 1st April deadline and as a result valuers, lenders and solicitors are busier, and completions may therefore take longer to go through.

How May We Help?

Although the clock may be ticking, if you are looking to purchase an additional property this would a good time to get Redbrick Properties involved. We can back up any research you have already put in with local industry knowledge allowing you to sit back and take stock. The bottom line is we will always give you an unbiased market appraisal, not just of present market conditions but we will also give you our predictions of what to expect medium to long term.

For any property Investment advice please feel free to get in contact, whether a phone call, email or dropping by for a coffee, we'd love to chat with you.

By Mark

Redbrick Properties over the years has been rewarding in the sense that with the correct vision you can formulate your aspirations, as long as you have an on-going business plan and a dedicated business partner Matt.

Over ten years in as director of Redbrick I’m as passionate as the first day when we picked up keys for our first lease, a first floor office above our good friends, Castlehill Estate Agents.