stamp duty and stamp duty land tax
Stamp Duty Land Tax (SDLT) has applied in the UK since 1 December 2003 when it replaced stamp duty on UK land and buildings and effected a substantially higher charge on leases for rent. The SDLT rates are
- nil where the price is £125,000 or less (£150,000 for non-residential or mixed use),
- 1 per cent where the price is between £125,001 (or £150,001) and £250,000,
- 3 per cent where the price is between £250,001 and £500,000,
- 4 per cent generally where the price is above £500,000 but
- 5 per cent for residential property over £1 million.
The rate of stamp duty land tax (SDLT) on a purchase of residential property is being increased from 5 per cent to 7 per cent where the consideration is more than £2m. But where such residential property is acquired by a 'non-natural person' (such as a company), the increase is to 15 per cent. The Annual Tax on enveloped dwellings will also apply to such property.
Stamp Duty at 0.5 per cent of the price paid applies to transfers of UK shares irrespective of value. Stamp Duty Reserve Tax instead of stamp duty is levied on transactions carried out through electronic share dealing systems (also at 0.5 per cent). The Government intends, following consultation, to abolish stamp duty on shares quoted on growth markets such as the Alternative Investment Market and the ISDX Growth Market. This will improve financing conditions for around 1,000 quoted UK businesses. (Updated by PwC, March 22 2013)