SDLT on property acquisitions by individuals

Produced by Tolley
  • (Updated for Budget 2020)
SDLT on property acquisitions by individuals

The following Personal Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:

  • SDLT on property acquisitions by individuals
  • Introduction
  • Provisions introduced due to the coronavirus (COVID-19) pandemic
  • Overview
  • Chargeable interests
  • Exempt interests
  • Exempt transactions
  • Gift
  • Divorce or civil partnership dissolution
  • Assents and appropriations by personal representatives
  • More...

Introduction

Stamp duty land tax (SDLT) was introduced for land transactions with effect from 1 December 2003. Whereas stamp duty was a tax on documents, SDLT is a tax based on the acquisition of a chargeable interest, whether or not evidenced in writing.

When it was originally introduced, SDLT applied to all UK land transactions. Devolution has resulted in Scotland and Wales introducing their own regimes.

From 1 April 2015, land and buildings transaction tax (LBTT) applies to land transactions in Scotland. For details of LBTT, see Sergeant and Sims on Stamp Taxes AA12–AA22 (SSSD, AA[AA351]–SSSD, AA[AA862]). See also the guidance on the Revenue Scotland website.

From 1 April 2018, land transaction tax (LTT) applies to land transactions in Wales. For details of LTT, see Sergeant and Sims on Stamp Taxes AA23–AA34 (SSSD, AA[AA901]–SSSD, AA[AA2115]). See also the guidance on the Welsh Revenue Authority website.

Whilst the underlying rules applying to LBTT, LTT and SDLT are broadly similar in nature, the taxes are not identical. The rest of this guidance note covers the law which applies to transactions in England and Northern Ireland.

For details of the 2% proposed SDLT surcharge on purchases of residential property in England and Northern Ireland by non-residents that is expected to apply from 1 April 2021, see the end of this guidance note.

This guidance note focuses on the rules for transactions where the purchaser is an individual. For the rules that apply to companies, see the Stamp duty land tax ― basic rules for companies guidance note.

Provisions introduced due to the coronavirus (COVID-19) pandemic

The Government has announced two changes to the SDLT rules as a result of the coronavirus pandemic:

  1. a temporary increase to the nil rate band on residential property purchases from £125,000 to £500,000 where the acquisition of a chargeable interest takes place between 8 July 2020 and 31 March 2021, see the GOV.UK website

  2. where the individual is unable to sell their main residence within three years of

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