SDLT / LTT / CGT Flashcards
(26 cards)
On what is SDLT assessed in freehold purchases?
On the purchase price paid for the property, including VAT if applicable.
How is SDLT calculated for residential property?
Using a slice system—different percentage rates apply to each band of the purchase price.
What are the SDLT bands for residential purchases?
0% on up to £250,000
5% on £250,001–£925,000
10% on £925,001–£1.5m
12% on over £1.5m
How does SDLT apply to contents?
Contents (e.g., white goods, furniture) can be separately valued and excluded from SDLT if their value is genuine.
What SDLT relief is available for first-time buyers?
No SDLT on the first £425,000, then 5% on the portion between £425,001 and £625,000.
When is the first-time buyer relief lost?
If the purchase price exceeds £625,000 or if any buyer is not a first-time buyer.
What is the additional SDLT charge for second homes?
3% on the whole of the purchase price, in addition to the normal SDLT calculation.
What SDLT rates apply to non-residential property?
0% on up to £150,000
2% on £150,001–£250,000
5% on over £250,000
What is the effect of VAT on SDLT calculation?
SDLT is calculated on the VAT-inclusive price if VAT is payable.
What is the Welsh equivalent of SDLT?
Land Transaction Tax (LTT).
What is a key difference between SDLT and LTT for first-time buyers?
LTT does not offer first-time buyer relief.
What are the residential LTT bands?
0% on up to £225,000
6% on £225,001–£400,000
7.5% on £400,001–£750,000
10% on £750,001–£1.5m
12% on over £1.5m
What are the non-residential LTT bands?
0% on up to £225,000
1% on £225,001–£250,000
5% on £250,001–£1m
6% on over £1m
What surcharge applies for second properties under LTT?
A higher rate (e.g., 4%) on the whole price, similar to SDLT’s 3% surcharge.
What expenses are deductible when calculating CGT on property?
Acquisition costs, disposal costs, and capital improvements (not maintenance or repairs).
Can repair costs be deducted from CGT liability?
No—only improvements that enhance the property’s value are deductible.
What is the CGT annual exemption?
£3,000—taxpayers can offset this amount from their gains before tax applies.
How are capital losses treated for CGT purposes?
They can be offset against gains in the same year to reduce taxable gain.
What is Private Residence Relief (PRR)?
A relief that exempts gains on the disposal of a person’s main residence from CGT.
What conditions must be met for PRR to apply in full?
The home must be the seller’s only/main residence, not let out (beyond a lodger), not used for business, under 5,000 sqm in size, and not bought to flip for profit.
Can PRR apply if the property was partially used for business?
Yes, but the relief is reduced proportionally to the business use.
What happens to PRR if the owner has multiple homes?
Married couples/civil partners can only nominate one main residence between them.
What happens to CGT liability if a home was only a main residence for part of the period owned?
PRR is apportioned, and CGT applies to the period where it was not the main home.
Is PRR available if the property is gifted rather than sold?
Yes, provided the recipient is not a spouse and other PRR conditions are met.
