Acquisition Cost
Buyers should expect to pay Legal Fees of around 0.5-1% of the property price. In addition, Stamp Duty Land Tax (SDLT), more commonly known as Stamp Duty, may be chargeable on the acquisition of UK property worth more than £40,000. Investors purchasing their second homes or buying to let are charged an additional 3% on top of the basic SDLT rate.
| Property Value |
Basic SDLT Rate |
Second Home / Buy-to-let SDLTRate |
| Up to £125,000 |
0% |
3% |
| £125,001 - £250,000 |
2% |
5% |
| £250,001 - £925,000 |
5% |
8% |
| £925,001 - £1,500,000 |
10% |
13% |
| More than £1,500,000 |
12% |
15% |
Ground Rent
A regular payment by the owner of leasehold property to the property’s freeholder, amounts to around 0.1% of the purchase price per annum, depending on the property type. This is typically subject to review every 10 years.
Service Charges
Vary among developers and according to the property’s level of facilities.
Disposal Cost
You have to pay Capital Gains Tax on residential property in the UK, even if you’re a non-resident for tax purposes. You only have to pay Capital Gains Tax on your gains above the tax-free allowance, or Annual Exempt Amount, of £11,3005 . The amount you pay depends on how much you have earned from the property sale and your taxable income, but it ranges from 18- 28% of your capital gains.
Inheritance Tax is charged at 40% on UK assets worth more than £325,000. There is no Inheritance Tax to pay if you pass a home to your husband, wife or civil partner, but if you leave the property to another person in your will it counts towards the value of the estate.
Brokerage and Legal Fees associated with property disposals vary.
Source: Jones Lang LaSalle
