Transfer Duty: Explained
When you're buying or selling a property you're often hit with a lot of terms that you don't come across frequently. The list of these terms could go on forever, so we're just going to have a look at one that trips people up, especially first-time buyers: transfer duty.
It can be very daunting to buy a house at the best of times, but that gets worse when you don't understand the terms that are being thrown at you. So, we're here to explain this one to you.
The basic definition of transfer duty is the tax applied to the transfer of ownership of property or land ownership from one person to another. It makes sure that everything has been legally signed over to you and been out in your name. Simple.
Sometimes transfer duty is known as stamp duty, so don't get confused if people use these terms interchangeably.
Most of the time this fee is included in quotes that you receive; our conveyancing team includes them in the fixed rate that we offer to people buying or selling because we want to include everything in one price to keep things easy to understand. But it is always best to get an itemised breakdown of what is covered to make sure there aren't going to be any extra fees.
With the amount of money that is involved in buying or selling a home we know how important it is to be able to understand where it's all going and to make sure you aren't paying over the odds.
With transfer duty there is no set value that you must pay, the amount that you pay varies depending on the value of the property. It can be calculated either on the market value of the property or the amount that you paid for it. Whichever one is higher, that's what it will be calculated on.
It's important to note that even if you paid no money for the property (such as if a family transfers the ownership of the property to you) you will still pay transfer duty. The amount that you would have to pay would be calculated based on what the market value of the property is.
I hope that this has made things clearer for everyone. But if you have any questions about this or any other fees then get in touch with our conveyancing team and they'll be able to help you.