How much Stamp Duty do I pay on Commercial Property?

Stamp Duty Land Tax (SDLT) is a form of tax that is paid on the acquisition of land in England and Northern Ireland. Although there are many factors that affect who pays it and how much they pay, generally, it is applied to increasing portions of the property price when you pay £150,000 or more on freeholds, leases, interests, rights and powers.

What is considered as a non-residential/commercial property?

The term ‘commercial property’ covers a wide array of property types, which include the following:

  • Shops and offices
  • Land used for agricultural reasons
  • Property deemed as unsuitable to be lived in
  • Six or more residential properties bought in one transaction
  • Mixed-use commercial and residential properties

Do I pay Stamp Duty Land Tax at the same rate as my residential property?

Although you are still required to pay Stamp Duty Land Tax in the same way you would on your residential property, the rates for residential and non-residential properties are vastly different. When you pay SDLT on a commercial property, you can expect to pay lower headline rates.

However, like residential property, the nil-rate band for SDLT stands at £150,000. Purchasers of commercial properties will still be expected need to fill out an SDLT return.

How is SDLT Calculated on Commercial purchases?

Commercial stamp duty rates apply whether you are buying the property outright as a freehold or acquiring a lease.

For Freehold sales and transfers, the following Stamp Duty Land Tax rates apply (information correct as of October 2022):

    • 0% on properties up to £150,000
    • 2% on properties valued between £150,001 and £250,000
    • 5% on properties over £250,000

How SDLT is Calculate on Commercial leases

When calculating your SDLT, there are several variables which will affect the fee you pay. These include:

  • The length of the lease term
  • Annual rent
  • Any premium paid for the lease

If you are uncertain on how these factors may affect you, speak to our friendly team today.

Commercial Property Solicitors Richmond Upon Thames

At Jackson Longe Solicitors, our team of experienced commercial property solicitors can assist you with your commercial property matter in Richmond. 

Please contact us today at 0208 332 2069 or email info@jacksonlonge.co.uk.
Alternatively, fill in an enquiry form, and we will get back to you.