UK personal finance glossary

Stamp duty

Also: stamp duty land tax

Everyday name for the tax on buying a residential property in the UK. The legal name depends on where the home is: SDLT in England and Northern Ireland, LBTT in Scotland, and LTT in Wales.

SDLT

Also: Stamp Duty Land Tax

Stamp Duty Land Tax. The residential property transaction tax in England and Northern Ireland. Charged in bands (slices), not as one flat percentage of the whole price.

LBTT

Also: Land and Buildings Transaction Tax

Land and Buildings Transaction Tax. Scotland’s equivalent of stamp duty, with its own bands, reliefs, and Additional Dwelling Supplement (ADS) rules.

LTT

Also: Land Transaction Tax

Land Transaction Tax. Wales’s equivalent of stamp duty, with its own bands and reliefs. Wales does not have a separate first-time buyer relief.

Band (or slice)

Also: slice · slices

A portion of the purchase price taxed at one rate. You add tax on each band; you do not apply one rate to the whole price. Palta often says “slice” for the same idea.

Nil-rate band

Also: nil rate · 0% band

The portion of the purchase price charged at 0%. It differs by nation and, for some buyers, by relief (for example first-time buyer rules).

First-time buyer relief

Also: FTB · FTB relief

A lower tax bill for qualifying first-time buyers. In England and Northern Ireland it only applies if the price is £500,000 or less and every buyer qualifies. Scotland has its own LBTT relief; Wales has no separate first-time buyer relief.

Additional property

Also: additional dwelling

A second home, buy-to-let, or similar purchase that usually attracts a surcharge on top of the main residential rates. Rules differ in Scotland and Wales.

ADS

Also: Additional Dwelling Supplement

Additional Dwelling Supplement. Scotland’s surcharge on certain additional dwellings under LBTT. It is separate from England and Northern Ireland’s higher rates of SDLT.

Non-resident surcharge

Also: non-resident SDLT

An extra SDLT charge that can apply when a buyer is not UK resident. Scotland and Wales use different rules; always check the nation where the property sits. Palta’s stamp duty calculator does not model every non-resident case.

AIP

Also: Agreement in Principle · Decision in Principle · DIP · mortgage in principle

Agreement in Principle (also called a Decision in Principle or DIP). An early indication from a lender of how much they might lend you, based on a soft or limited check. It is not a formal mortgage offer and can change after full underwriting.

LTV

Also: loan-to-value · loan to value

Loan-to-value. The mortgage as a percentage of the property’s value. A larger deposit lowers LTV, which can unlock better rates and means you borrow less.

Capital-and-interest

Also: repayment mortgage · capital and interest

A repayment mortgage where each payment covers interest and some of the loan balance, so the balance falls over the term if you keep to the schedule.

Interest-only

Also: interest only

A mortgage where the regular payment covers interest only. The loan balance does not fall unless you make separate capital repayments or have a repayment vehicle at the end.

SVR

Also: standard variable rate

Standard variable rate. The lender’s own variable rate that many borrowers move onto when a fixed or introductory deal ends, unless they switch in time.

SMR / BMR

Also: SMR · BMR · Standard Mortgage Rate · Base Mortgage Rate

SMR means Standard Mortgage Rate; BMR means Base Mortgage Rate. Both are brand names some lenders use for the variable rate you usually fall onto when a fixed or introductory deal ends, if you have not switched to a new deal. Same idea as an SVR: the lender sets it, and it can rise or fall.

Tracker

Also: tracker rate · tracker mortgage

A mortgage rate that follows a published index (often Bank Rate) plus a lender margin. Payments can rise or fall when the index moves.

BoE

Also: Bank of England

Bank of England. The UK’s central bank. It sets Bank Rate and publishes market data such as yield curves that help price fixed mortgage deals. Palta’s indicative rate uses BoE swap inputs where available.

BEBR

Also: Bank of England Base Rate · Bank Rate · base rate · BoE base rate

Bank of England Base Rate (also called Bank Rate). The official interest rate set by the Bank of England. Many tracker mortgages are priced as BEBR plus a fixed margin, so the rate and payment move when the base rate changes.

Product transfer

Also: product transfer deal

Moving to a new mortgage product with your current lender, often without a full remortgage application. Usually simpler than remortgaging elsewhere, but you only see that lender’s range.

Remortgage

Also: remortgaging

Switching your mortgage to a new lender (or sometimes a new deal). Usually means a full application, credit checks, and conveyancing, but opens the wider market.

ERC

Also: early repayment charge · early repayment charges

Early repayment charge. A fee some lenders charge if you repay or leave a fixed deal before it ends. Compare total cost including ERCs, not the headline rate alone.

Arrangement fee

Also: product fee · booking fee

A product or arrangement fee charged to set up a mortgage. Sometimes added to the loan. A lower rate with a high fee is not always cheaper overall, especially if you remortgage again soon.

Conveyancing

Also: conveyancing fees · conveyancing fee

The legal process of transferring property ownership. Buying costs often include conveyancing fees alongside stamp duty, survey, and lender fees.

Offset

Also: offset mortgage · offset account

A mortgage product style that links a savings (or current) account to the loan. The linked balance reduces the amount you pay interest on, so interest falls while the money stays accessible under the product rules.

Green Home

Also: green mortgage · green home mortgage

A mortgage product style aimed at energy-efficient homes or green improvements. Lenders may offer a lower rate, cashback, or extra borrowing for properties that meet an energy rating or for funded upgrades. Criteria and benefits vary by lender.

Springboard

Also: springboard mortgage

A mortgage product style for buyers with a small cash deposit (a high LTV, often around 90–95% of the price). A family member usually lodges savings in a linked account as security, which can let the lender treat the loan as lower risk. Rules, rates, and what happens to the linked savings differ by lender.

BTL

Also: buy-to-let · buy to let

Buy-to-let. A mortgage for a property you intend to let to tenants rather than live in as your main home. Pricing, criteria, and stamp duty treatment usually differ from a residential purchase.

Council tax

A local tax on residential property in England, Scotland, and Wales. The bill depends on the property’s band and which council covers the area. Scotland’s bill usually includes water and sewerage; England and Wales treat those separately. Discounts and exemptions can reduce what you pay.

DWP

Also: Department for Work and Pensions

Department for Work and Pensions. The UK government department that runs State Pension and many working-age benefits, including Universal Credit. Separate from HMRC, which collects tax and National Insurance.

HMRC

Also: HM Revenue and Customs · HM Revenue & Customs

HM Revenue and Customs. The UK department that collects Income Tax, National Insurance, and other taxes, and issues tax codes. Separate from the DWP, which runs most benefits and State Pension.

National Insurance

Also: NI · National Insurance contributions

National Insurance contributions. Calculated separately from Income Tax on earnings above the primary threshold. Often shortened to NI.

Tax code

The HMRC code on your payslip that tells your employer how much tax-free allowance to apply and how to treat certain adjustments. Wrong codes are a common reason net pay looks off.

Student loan plan

Also: Plan 2 · Plan 4

UK student loan plans (for example Plan 1, 2, 4, or postgraduate) deduct a percentage of earnings above a plan-specific threshold. The plan affects take-home pay but is not Income Tax.