Chattels, fixtures and fittings: what qualifies for Stamp Duty Land Tax?
When buying a property, it comes with fixtures and fittings already installed. Additional items sold as part of the sale, like furniture, are considered chattels. You don’t pay Stamp Duty on chattels. 1 in 3 overpay stamp duty. Read on to see if you could be one of them.
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What are fixtures and fittings?
Fixtures and fittings are considered all items that are “permanently” installed in a property. They include kitchen cupboards, worksurfaces, fitted ovens, bathroom ceramics, alarm systems, light fixtures, and shrubbery growing in the soil.
What are chattels?
Chattels are other items in the home that are not permanently fitted. They include furniture, carpets, curtains, blinds, freestanding white goods, non-integrated electric and gas fires, light shades, garden furniture, and potted plants.
What qualifies for Stamp Duty?
- Fixtures and Fittings
- Integrated kitchen units and sinks
- Fitted ovens, hobs and gas
- Ceramic bathroom items, like sinks, toilets, baths, showers and basins
- Central heating systems, including radiators, boilers and pipework
- Intruder alarm systems
- Plants, shrubs, or trees growing in soil in the back or front gardens
- Chattels
- Carpets
- Curtains and blinds
- Furniture, like sofas, dining tables and freestanding shelving units
- Electric and gas fires that can be disconnected without causing damage
- White goods, like freestanding washing machines, fridge freezers and tumble dryers
- Lamp shades
Calculating Stamp Duty when buying a property
- Standard residential stamp duty rates*
- 0% up to £250,000
- 5% on the proportion from £250,001 to £925,000
- 10% on the proportion from £925,001 to £1.5 million
- 12% on any remaining amount over £1.5 million
- *You pay an additional 2% on all residential rates if you’re a non-UK resident buying property in England or Northern Ireland.
- Second property/company residential Stamp Duty rates*
- 3% up to £250,000
- 8% on the proportion from £250,001 to £925,000
- 13% on the proportion from £925,001 to £1.5 million
- 15% on any remaining amount over £1.5 million
- *If your company meets certain criteria, the company residential stamp duty rates do not apply and you pay a 15% rate on properties over £500,000. You do not pay the 3% surcharge on top of this.
- Non-residential Stamp Duty rates
- 0% up to £150,000
- 2% on the proportion from £150,001 to £250,000
- 5% on any remaining amount over £250,000
How is Stamp Duty calculated for chattels?
The cost of chattels is agreed between the buyer and seller during the sale of a property. Generally, the costs are minimal and agreed upon separately from the sale price, so it’s easy to separate these for Stamp Duty purposes.
However, for furnished or commercial properties, the cost of chattels may be factored into the purchase price. The proportion for chattels is exempt from Stamp Duty, so it must be separated from the property’s value.
In these cases, an independent valuation may be required to prove to HMRC that the value of chattels is “just and reasonable” for Stamp Duty exemption.
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Paying Stamp Duty on chattels, fixings and fittings
You pay Stamp Duty on fixtures and fittings in a property. This is because the fixtures and fittings in a home are sold as part of the purchase price. Therefore, Stamp Duty applies to the costs of these items.
Chattels are items you agree with the seller to pay more for if they leave them behind, like furniture or white goods. Because these costs are in addition to the purchase price of the property, you do not pay Stamp Duty on the cost.
The buyer and seller typically agree on a price for chattels in a property. For example, they may agree to pay an extra £3,000 for the garden furniture to be left behind. This £3,000 should be exempt from Stamp Duty, provided it meets HMRC’s requirements.
HMRC require that the costs of chattels are “just and reasonable”. The exact definition is as follows:
“The valuation of chattels should represent the open market value (including depreciation) at the effective date of the transaction, bearing in mind the age, quality and condition of each item”.
An independent valuation of the costs may be required to determine the value of chattels and what should be deducted for Stamp Duty purposes. This is typically beneficial if the property is sold fully furnished or with industrial equipment installed.
You don’t pay Stamp Duty on a property purchase if:
- You are a first-time buyer
- You inherit a probate property in a will
- You are transferred a property after divorce
- You are transferring property between group companies (known as Group Relief)
- You buy a residential property that costs less than £250,000 and it isn’t your second home
- You buy an uninhabitable or non-residential property below £150,000
You may also be exempt from paying Stamp Duty if you qualify for other relief.
Are you owed thousands in Stamp Duty?
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Are you owed thousands in Stamp Duty?
Frequently asked questions about fixtures and fittings
You pay Stamp Duty Land Tax (SDLT) on fixtures and fittings in a property. This includes things like integrated kitchen units, bathroom sanitary items, light fixtures and trees in the garden. Generally, the cost of these items is included in the valuation and purchase price of the property.
Some items that are sold with a property are exempt from Stamp Duty. These are any items that aren’t considered fixtures and fittings. You agree to pay for these items separately and therefore do not pay Stamp Duty on the costs. The valuation of these items, known as chattels, must be “just and reasonable” according to HMRC. An independent valuation may be required to justify the costs.
Chattels are any movable items on a property that the seller agrees to leave behind after the sale for an additional cost. For example, sofas, dining tables, beds, garden furniture, non-fitted hot tubs, carpets, curtains, blinds, white goods, light shades, freestanding electric and gas fires, or machinery are considered chattels.
The term “chattels price” means the cost of the additional furnishings left behind in a property after the sale. For example, the furniture or white goods. The price of chattels is typically agreed upon between the buyer and seller. However, for the costs to be exempt from Stamp Duty, they must be considered fair.
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Paul EdwardsI reached out to StampDuty.com in August to discuss a purchase I made last year.
The property was in a bad state of repair, lots needed doing. When StampDuty.com gathered the documents and images of the property, they let me know I could save roughly £40,000. This seemed amazing but i was sceptical, why didn't my lawyer point this out. After many reassuring conversations and pointing to legislation to explain their answers, we pushed ahead.
I am pleased to say I received my refund at the end of October! I just want to thank Joe and the team for all of their hard work and the fast turnaround.