Stamp Duty Calculator

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Use Chattels To Avoid Stamp Duty

27 September 2011

Stamp Duty Calculator specialises in Stamp Duty Mitigation services for a variety of customers.

There are a variety of SDLT (or Stamp Duty Land Tax) avoidance methods available from Stamp Duty Calculator to you when purchasing property. When you're done reading this, you should have at least a basic idea of how chattels can be a part of your SDLT avoidance strategy. You can think of chattels as all of the items sold with the property that are removable from the property without tangibly changing the immovable parts of the property. A bit of a mouthful, but let us explain.

Chattels, which often includes such things as household furniture and appliances, should be listed in the property purchase contract. But regardless of whether they are listed in the property purchase contract or listed as a separate purchase contract, chattels are part of the agreement, typically listed in the contents form which includes fittings and fixtures as well.

So now let us take a closer look at the SDLT rates. A Stamp Duty Calculator can come useful here. The SDLT stipulates that any normal property sold for more than £125,000 triggers a Stamp Duty unless certain other conditions are met:

• If the property sells for more than £125,000, but less than £250,000, the Stamp Duty is 1%.
• If the property sells for more than £250,000, but less than £500,000, the Stamp Duty is 3%.
• If the property sells for more than £500,000, but less than £1,000,000, the Stamp Duty is 4%.
• Anything over £1,000,000 triggers a 5% Stamp Duty.

A mistake you want to avoid, and one that we often hear about here at Stamp Duty Calculator, is having the price of any chattels included in the Stamp Duty applicable price of the property if you are near the lower end of a tax boundary. You are not responsible for tax on these chattels, which is why it is crucial to establish their values apart from the value of the fixed property. If you do not ensure that all of the chattels are listed on the property purchase contract, you may find yourself paying more than your fair share of the SDLT.

Chattels SDLT Avoidance Example

So let us say you want to purchase a property and the seller is adamant that the absolute minimum price is £127,000, but is willing to throw in £3,000 worth of chattels. You make sure that the property purchase contract shows the chattels valued at £3,000 and the fixed property at £124,000. Since the price of the property listed is below £125,000, you don't have to pay the SDLT. If you had failed to list the chattels, you would owe a Stamp Duty of £1,270. An expert at Stamp Duty Calculator can help you avoid these types of errors.

Thus, by getting the seller to include chattels in the transaction you are able to avoid the SDLT, even though the seller wasn't willing to lower his price. However, you have to be careful to ensure you follow the regulations about what constitutes a chattel. The general principle used is that anything that the seller would normally take with him after selling the property is a chattel. You have to be careful about some items that can go either way, such as small central heating systems. Stamp Duty Calculator can put you in touch with an adviser that can answer any questions you may have on this.

If you're purchasing property for more than £125,000, it is crucial to get together with a professional tax planner here at Stamp Duty Calculator to discuss SDLT avoidance mechanisms such as chattels.

Avoid Stamp Duty

26 September 2011

Stamp Duty Calculator specialises in Stamp Duty Mitigation for its customers. In this article we are going to explain what SDLT Mitigation is and how Stamp Duty Calculator can help.

Since recent tax law changes, United Kingdom citizens have been able to save considerable amounts of money on their property purchase by using specialized tax techniques to avoid the stamp duty liability. If you have not yet purchased your residential or commercial property and preferably before you have made an offer, first use a stamp duty calculator to find out how much SDLT is due, and then learn how you could save thousands of pounds on taxes. For example, a property purchase of at least £250,000 could save several thousands of pounds, while a £1,000,000 purchase could typically save over £20,000.

Typically, the use of these techniques will not change anything about the purchasing process nor slow down the purchasing timescales. The use of these techniques will be fully disclosed with the land registry and to Her Majesty's Revenue and Customs. Most mortgage lenders will accept these techniques since they are compliant with the Council of Mortgage Lenders rules. These laws have been successfully applied by individuals, partnerships, and limited companies for years, so there is no reason to doubt their legality.

In some cases, whether your offer includes or excludes chattels can affect your taxes due at closing by thousands of pounds. First time home buyers, or the spouses or partners of first time home buyers, can sometimes benefit by placing the property under only the first time buyer's name to reduce or eliminate taxes. Certain properties also received special treatment, including ones that are in a redevelopment zones or ones that qualify as right to buy schemes. Carbon neutral homes also received special treatment, with one's which can be certified by an authorized assessor to be 100% carbon free.

Tax rates differ according to the value of the property. For a property less than £125,000, there is no stamp duty. For properties between £125,000 and £250,000, the there is a 1% rate. The rate goes up to 3% for properties between £250,000 and £500,000, 4% between £500,000 and £1,000,000, and 5% for over £1,000,000. Get in touch with us here at Stamp Duty Calculator before making an offer so that you can know how to structure your offer and the most advantageous method.

Stamp Duty And Other Costs When Buying A Property

19 September 2011

Unfortunately, buying property in the UK isn't as simple as finding a property you'd like to buy and getting hold of a mortgage. A variety of other costs come into play when purchasing property in the United Kingdom. A large one-off tax that is payable on completion of the purchase is stamp duty. Despite being a substantial tax Stamp Duty (SDLT) may be reduced or avoided entirely with the correct tax planning - you can find out how much you'd have to pay by using a stamp duty calculator.

Additional costs involved with property purchase include but are not limited to: a mortgage application fee (sometimes called an "arrangement fee"), and a basic valuation fee (which is generally about £100) and conveyancing fees.

Next, a Building Survey or Home Buyer's Report must be conducted. The exact fees depends on the type of survey but they will generally run from £250 to £1000.

A variety of legal and conveyancing fees may also apply to property purchases and these fees can vary greatly depending upon the firm. Legal fees may be a fixed amount or calculated as a percentage of the property price (sometimes as much as 0.5%).

Also based upon the price of the property being purchased is the Land Registry Fee which is generally £40 to £800. If a real estate agent is involved in the property purchase, then the buyer, seller, or both will need to pay the real estate agent's fees which may be as much as 2% of the selling price of the property.

Once the property has been purchased, moving and removal fees can add up quickly. And a variety of other insurance, utility set up, and of course decorating costs will also come into play.

On top of all of the other costs of purchasing property and moving, properties in England and Wales are also subject to SDLT. This alone is often more than all other fees and costs above combined. Stamp Duty Land Tax / SDLT) is calculated based upon a percentage of the property price subject to different taxation brackets. A Stamp Duty Calculator can help you find out the exact amount of tax due on a property purchase.

Fortunately, properties purchased for less than £250,000 are not subject to SDLT. And for properties of £250,000 or more, SDLT Mitigation, as described by Stamp Duty Calculator, may be able to help buyers lower or completely avoid SDLT fees. Many people are unaware about SDLT Mitigation options as general legal counsel and estate agents are not knowledgeable about how it works. Professional SDLT Tax consultants, such as Stamp Duty Calculator, are available to help people avoid stamp duty costs. Their fees are always less that the SDLT the buyer would have had to pay, and they generally charge based on how much they are able to help the client save.

When it comes to properties purchased for £1 million or more, being able to avoid stamp duty can help buyers save more than £25,000. Stamp Duty Calculator works with some of the leading tax experts in the UK, so if you are considering buying property in the UK for more than £250,000.

If you are in the process of purchasing a home or land in England or Wales we recommend you contact one of our experts by completing the simple online form on our site.

Stamp Duty Calculator Can Help You Avoid SDLT

17 September 2011

Purchasing real estate in the United Kingdom nowadays is not an easy thing to do, and it isn't showing any signs of getting easier. Even with the world in an unstable recession, prices for homes are going up and staying up. In fact, there are numerous homebuyers who are having a difficult time trying to obtain a mortgage that will let them enter the world of home ownership. Also, besides the mortgage itself, another expense that can blindside the unwary homebuyer is the Stamp Duty. This is a tax based upon a percentage of the purchase price of the land or property. It is placed upon all homes that are bought throughout England as well as in Wales. This tax, fully known as the Stamp Duty Land Tax or SDLT for short, is rated on a percentage value of the sales price of the real estate. There is a sliding scale, for instance, at £250,000 on up to £500,000 the SDLT percentage is 3%. At £500,000 through £1,000,000, it is 4%, and anything over £1,000,000 the percentage is at 5%. A Stamp Duty Calculator can be a useful tool to use to find out how much SDLT is due on a property and keep you fully informed as to your tax liability.

This might seem daunting, even hampering to homebuyers, but there are some things that can be done to avoid the SDLT altogether. Known as Stamp Duty Mitigation, this strategy is presented by many tax planning professionals throughout the United Kingdom to their clients. This technique brings together several tax preparation processes to either lower or outright remove the SDLT expense, essentially placing several thousand pounds back into the home buyers’ bank account along the way. On this site we have a stamp duty calculator you can use to see the potential savings you could make.

There are other ways to remove the Stamp Duty from your expenses, such as with the zero carbon emission scheme, which has been applied to new properties ever since the government brought it about back in 2007. The scheme is a government incentive to bring eco-friendliness to the real estate market all over the United Kingdom. Once again, look to your tax preparing professional for applying these or any other similar Stamp Duty exemptions as you put together your plan to buy property.

Businesses that provide tax preparation services usually attach a fee to such services that is equal to a percentage of how much of the Stamp Duty they help the home buyer save. The percentage that a tax preparing service charges is wholly individual to the business, but as a general rule it will be nearly fifty percent of the saved amount of stamp duty. Some businesses will add a fixed amount to their fees above and beyond the SDLT relief fee, and this fixed fee will be in the several hundreds of pounds range. There are also businesses that will provide guarantees and insurance policies just to help alleviate any worry that if, for some reason, the HMRC decides to investigate the tax planning the end-customer is fully covered against any shortfall.

For the mere fact that the Stamp Duty will fluctuate based upon how much a piece of property is valued at, mitigating strategies for it are definitely worth exploring if the property being considered is valued at greater than £500,000. Just to illustrate, on a property of at least £1,000,000, mitigating the SDLT would keep more than £25,000 in the homebuyers' pocket. Use a Stamp Duty Calculator for other examples; you will be amazed how much money can be saved. This isn't to say that lower valued properties aren't worth considering but realize that the savings on the SDLT is also lower, down to only a few thousand pounds. Still, this is a few thousand pounds that you could spend on updating your new home with modern fixtures and fittings.

What a Stamp Duty mitigation specialist will do is look deeply into your particular situation in order to assemble the right strategy for you that will help you to steer clear of paying a tax that is unnecessarily expensive. The best thing to do right now is to get in touch with a specialist to begin discussing how you can keep thousands of pounds in your pocket that would otherwise end up in the coffers of the government. Stamp Duty Calculator can help you save a lot of money, so do not wait and fill in our enquiry form now.