When it comes to calculating stamp duty, the first thing you will want to understand is how the stamp duty bands are graded. Bear in mind that they are subject to change from tax year to tax year but currently graded as follows:
- 0% for properties costing between £0 and £125,000
- 1% for properties costing between £125,000 and £250,000
- 3% for properties costing between £250,000 and £500,000
- 4% for properties costing a sum greater than £500,000
- 5% threshold for properties over £1 million (as of 6 April, 2011)
You also need to understand that the stamp duty land tax is paid on the entire cost/value of the property, not just the amount above a threshold which would be the case with such taxes as income tax.
Therefore, if you purchased a plot of land which costs £125,000 you would pay £1,250 in stamp duty, but if that same property was sold for just £124,999 there would be no fee. You can see how this would provide a significant savings, especially on more expensive real estate.
Stamp Duty Land Tax Calculator
Of all the online calculators, a stamp duty calculator is among the easiest to use. Online calculators are user friendly form-based software programs which are freely available on many websites.
Because there are generally only two fields to fill in when looking for the land registry on a property, it only takes knowing the selling price and then whether or not you are a first-time home buyer. The government is continually making enhancements to first-time buyer incentives, so the amount you save could change from time to time.
For instance, a current homeowner buying a home in a new location at a selling price of £181,000 would pay stamp duty of £1,810. On the other hand, a first-time home buyer paying the same amount would have no tax. This would be the case on properties priced up to £250,000. However, the land registry calculator returns a stamp duty of £2,500.01 if just £1 is added to the sales price and if the sales price is £251,000 the stamp duty jumps to an incredible £7,530 even for a first-time home buyer. (This would be the time for some serious negotiating with the seller!)
As you can see, a HMRC stamp duty calculator can help you save literally thousands of pounds if you take a few moments to go online to use it. Since they are so easy to use, there is no reason not to try your hand at it the next time you are looking to buy a home, flat, building or even a piece of land.
Since December of 2003 the new Stamp Duty Land Tax has taken the place of the old stamp duty when purchasing properties which include houses, flats, buildings and even land. The amount you pay is a percentage of the purchase price and these percentages are graded into bands.
Even a £1 difference in price could mean paying literally thousands extra in stamp duty so you will want to keep a land registry fee calculator bookmarked on your web browser if you are in the process of purchasing property. Negotiating price down a few pounds could save you a significant amount of money in the end!
Second Home Stamp Duty
When it comes to purchasing another property, a second home stamp duty calculator is able to conclude your payments, allowing your finances to be much clearer when managing multiple properties.
Second home duty tax has risen since April 2016 and as a result, you will pay considerably more in stamp duty. The tax bands have a lower starting threshold of £40,000 and an average fee of 3% – a much higher cost than the stamp duty on your first home!
Anybody who purchases a second property over the £40,000 band will be obliged to pay these fees, regardless of how the property will be used (including holiday homes, buy-to-let or main residence).
A second home stamp duty calculator is able to tell you the kind of land registry that you will be expected to pay.