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Q&As
What stamp duty rate do I pay on a plot with no house?
We are buying a plot of land that has nothing on it at present, and our solicitor thinks we need to pay a stamp duty rate equivalent to a second home rate. Is this correct? Many articles say we should only pay 2% for £100,000 to £250,000 and 5% on anything above that.
One Answer
Hi Michael, your solicitor might be right, but how much SDLT you pay depends on whether the plot is classified as residential or non-residential. Vacant plots can still be treated as residential if they are intended for residential development and appropriate planning permission exists for them. If your plot is residential with planning permission for a house, the normal rates of SDLT apply (0% on land priced up to £125,000, 2% on the portion between £125,000 and £250,000, 5% on anything between £250,000 and £925,000, 10% on the portion between £925,000 to £1.5m, and 12% on anything beyond that).
If the land is non-residential, however, and doesn’t have planning permission to turn it into a residential site, SDLT rates are 0% on the first £150,000, 2% on the portion between £150,000 and £250,000 and then 5% on anything more than £250,000.
If you already own another property and are not replacing your main dwelling with this second plot, you will need to pay the higher rates of SDLT for second home ownership. At time of writing, this means paying an extra 5% on top of the standard residential SDLT rates.
Best wishes,
Rachel Pyne, Build Store