
SDLT on staircasing transactions is horrendously complicated. Staircasing is where you buy additional shares in the property, increasing your ownership and reducing your rent until you eventually own 100%. The disadvantage of paying SDLT in stages is that additional SDLT payments will become payable when you staircase above 80% ownership. This means that, unless your rent is exceptionally high, there would be no stamp duty to pay at all when you buy this property and opt to pay in stages. Currently, the SDLT threshold is £250,000 – if the consideration is below this amount, there is no SDLT to pay.
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Fortunately, HMRC provides a calculator to make life easier for you and your solicitor.įor example, if you paid £80,000 for a 25% share in a property valued at £320,000, SDLT would be payable on £80,000 plus the lease element. This is a complicated calculation based on total rent payable over the lifetime of the lease. An additional amount to reflect the rent you must pay to the housing association.

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Paying SDLT on the initial share you purchaseīudget-conscious home buyers often choose to pay SDLT on the actual share of the property they purchase rather than on the full value of the property.

However, it can lead to further SDLT charges down the line. On the face of it, the second option appears to be the more cost-effective as it should reduce the amount of SDLT you have to pay. You can either pay on the full market value of the property (as if you were buying 100% ownership) or just on the initial share you purchase plus the rent. When you buy a new shared ownership property, you are given two options for paying Stamp Duty Land Tax (SDLT). Click here if this is of interest to you.Home > Property Law > Conveyancing Solicitors London > Shared Ownership Stamp Duty Do you pay stamp duty on shared ownership?

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