You will find that most transactions in the UK, typically, are associated with some form of tax which either applies to the buyer or vendor or even both. What type of tax you pay and how much of it you pay varies greatly depending on situations you may have no control over and also your personal circumstance often has an influence. So, when it comes to deciding to embark upon the venture of selling your house, assumingly, your main priority will be to make a profit of some sort. The ideal scenario would be for the sale of your house to go as efficiently and as cost-effective as possible. Plausibly, you may be thinking what costs you may have to endure and specifically, if you have to pay tax when selling your house.
Bellow, we have put some information together regarding the most common types of taxes that are typically associated with the housing market. Keep on reading to see whether you may be impacted by one or more of these tax brackets.
Stamp Duty Land Tax
Presumably the one you may have heard about the most, ‘Stamp Duty’ is a form of tax which affects people who are looking to buy a house, rather than sell it. A buyer of a house in the UK may pay Stamp duty with the dependency being on the date they purchased the property and also, the amount of money the house was sold for. If you are looking to sell your property as well as buying a new house then you may want to bare the fee of stamp duty in mind. Stamp duty tax rate varies from 2% up to 12% of the property value. You would only pay Stamp duty if the new house you are buying equates to a value of more than £125,000. If you are a first-time buyer however, the tax would only apply to you if the price of your chosen property amounts to greater than £300,000. If you are looking to buy and sell a house at the same time and would like to enquire about the amount you could possibly be paying; tax calculators are available on the government’s website for your disposal.
Capital Gains Tax
You are required to pay this form of tax if you make a profit on the sale of a house. Although, it only applies If the property is not your home. For example, you may pay Capital gains tax on the profit you make on selling a business premises or an inherited house. Furthermore, you are only taxed on the profit you make and the profit alone, rather than the entire sum of money you receive.
Inheritance Tax
If you are looking to sell a house which you have inherited through someone who has died, you may already be aware of this form of tax. However, this tax is dealt with by an executor; a person who deals with the will. Although, if you decide to sell or rent out the property you inherit, you may have to pay tax on the rental income or any profit you make on the sale.
For more information on ‘Capital gains tax’, ‘Stamp Duty’ and the fee’s involved in buying and selling property, check out our other FAQ’s on https://fastcash4houses.co.uk/. Or, if you’d prefer, get in contact with us to speak to a member of our team directly on 01204 294356 or [email protected]. Here at FastCash4Houses, we are dedicated to helping you every step of the way so don’t hesitate to reach out.
