UK: Domestic Corporate Taxation
Stamp duty is charged on real estate transactions, and on certain share transactions.
The duty is 0.5%, rounded to the nearest GBP5, on share purchases exceeding GBP1,000, where the transaction is not electronic. Shares bought electronically are subject to stamp duty reserve tax of 0.5%, rounded up or down to the nearest penny, of the amount paid for the shares (and therefore not on the value of the shares). The tax is automatically deducted when the transaction is made.
A company that buys back its own shares held on an overseas branch register is relieved from paying stamp duty.
Stamp duty land tax (SDLT) is payable on non-residential real estate transactions exceeding GBP150,000. Rates are 1% for real estate valued at up to GBP250,000, 3% where valued at up to GBP500,000, 4% where valued at over GBP500,000, 5% where valued between GBP1m and GBP2m, and where valued above GBP2m the rate is 7% (5% prior to March 22, 2012). In the case of rent for new leasehold properties, a flat 1% SDLT applies to the value that exceeds GBP150,000, plus a “lease premium” that is based on the 1%-4% SDLT rates listed above.
Various stamp duty reliefs and exemptions apply.