It is something many of us have paid, or heard about – but stamp duty can still feel like a bit of a mystery, especially if you are a first-time buyer.

Buying your first, or next, home should be an exciting moment. But, keeping track of all legal proceedings surrounding your purchase can often detract from the excitement, and leave you with a few headaches.

Here is a simple explainer from our expert solicitors in Portsmouth.

Stamp duty explained

Stamp duty is a fee or a tax that you pay to HMRC when you purchase a property that is worth over a certain price.

If you are a first-time buyer, this can often be an unwelcome surprise when saving for your new home. The rates, and cost to you, can sometimes be hard to estimate as each property is different.

While it can seem like a straightforward process, our conveyancing solicitors in Portsmouth can help you should you ever become stuck with the rates or other intricacies that surround this tax.

Who needs to pay stamp duty?

If you are buying a home, you can expect to pay stamp duty. Most often, a solicitor will pay it on your behalf during the purchase process. This keeps things simple for you.

In England and Northern Ireland, stamp duty will not be collected on the first £250,000 of the property’s worth. For the first £425,000 of the property’s worth, first-time buyers are exempt from stamp duty.

If you are purchasing a second home, you will pay 3% at the lowest band (and increasing rates above this figure). In addition to the standard charges, you will be charged an additional 2% if you do not reside in the UK.

The government plans to reassess stamp duty in April 2025, and rates could change.

Can I add the stamp duty to my mortgage?

Maybe. This will depend on the lender who is offering you the mortgage, but it is often best if you avoid this.

This can result in a higher interest rate and a higher price in the long term when you are paying the mortgage back.

Be warned – It can also affect the offers open to you in the future if you want to borrow against your home.

If you need any help with clarification around stamp duty and mortgages, our team are ready to help.

Need help understanding stamp duty?

It can seem a little confusing. That is why we believe it is our job to take care of stamp duty and leave you free to plan for your future home.

We have helped first-time buyers and multiple homeowners across the South understand and pay their stamp duty with ease.

The support from an experienced team of conveyancing solicitors makes the process of buying or selling your home simple.

Get support from your local solicitor in Portsmouth

Andrew & Andrew provide timely, resourceful and cost-effective legal solutions for all your conveyancing needs, and take care of all legal processes involved with property transfer.

We are here to help, whenever you are ready. To get started, please talk to our team.

Andrew & Andrew Solicitors proudly serve clients across Hampshire from our Portsmouth, Emsworth, and Wickham offices.