Stamp duty land tax is the tax which is payable on any property or land which is transferred in the UK when the price of which is above a certain threshold. HM Revenues and Customs must be notified of all property and land transfers, including those which do not qualify for being charged stamp duty land tax. A tax return will need to be sent to them within a limited period of time.
Stamp duty land tax is calculated on the basis of the “chargeable consideration,” which takes into account, not only money, but also a release from debt, the transfer of a current mortgage or any services provided. The amount of tax charged is influenced by a series of considerations such as whether the land is residential or non-residential, freehold or leasehold, or other factors; for example if there are several different transactions which are related to each other. Certain types of transactions can have reduced rates of stamp duty land tax or even be exempt completely.
The amount of stamp duty land tax charged on the land or property is calculated as a percentage of the cost when it is purchased or transferred. Increased rates of stamp duty land tax are applied to transactions of a higher value.