The Act Amount of tax chargeable Section 25 – Amount of tax chargeable
69.This section sets out how to calculate the tax due in relation to a single transaction that is not a linked transaction.
70.Under the “slab” system of SDLT, tax is charged at the applicable rate on the whole consideration for the transaction. For example, if a house is sold for £240,000 the SDLT due is 1% of the whole amount while for a house costing £260,000, the SDLT due is 3% of the whole amount. By contrast, this section (read with section 24) provides for a “progressive system” that includes a nil rate band and at least two other bands. This structure will mean that only the portion of the consideration above the threshold and within the band will be liable to the higher rate of the band. LBTT is therefore to be calculated in a similar way to UK Income Tax.
71.The tax rates and bands which are applicable to the transaction will depend on whether it is a residential property transaction or a non-residential property transaction.
72.Defined terms used in this section: