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 · bands

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 · first-time buyer · 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: second home · buy-to-let · 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.

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.

Deposit

Also: down payment · downpayment

The cash you put towards the purchase price upfront. The rest is usually borrowed as a mortgage. Deposit size drives LTV and often the rate on offer.

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.

Fixed rate

Also: fixed deal · fix

A deal where the interest rate stays the same for a fixed period. When the fix ends you usually move to a new rate (often the lender’s SVR) unless you remortgage or take a product transfer.

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.

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.

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.

Fee payback

Also: fee break-even · payback period

How many months of a cheaper monthly repayment it takes to recover an extra product fee. If you remortgage before payback, a no-fee higher rate can win on cash cost.

Ownership costs

Also: running costs · ownership running costs

Ongoing costs of owning a home beyond the mortgage repayment: council tax, maintenance, buildings insurance, and leasehold charges such as service charge or ground rent.

True cost of owning

Also: true cost of ownership

Mortgage repayment plus ownership running costs in one monthly housing picture — not the loan payment alone.

Net asset difference

Also: net assets

In Palta’s buy vs rent model: buy total assets minus rent total assets at the end of the mortgage term under your assumptions. Positive means buy is ahead on that scenario; negative means rent is ahead. It is a model output, not a market forecast.

Total assets

In Palta’s buy vs rent add-on: the modelled wealth on the buy path (for example equity and cash) or the rent path (for example invested spare cash) at the end of the term.

Invest the difference

Also: investing the difference

When comparing rent vs buy, the idea that money not spent on a deposit, stamp duty, or a higher monthly housing cost can be invested. Palta lets you set an assumed return; it is a planning dial, not a predicted market return.

Gross pay

Also: gross salary · gross income

Your pay before Income Tax, National Insurance, pension, and student loan deductions. The headline salary figure is usually gross.

Net pay

Also: take-home pay · take home · net salary

What lands in your bank after Income Tax, National Insurance, and other deductions such as pension and student loan. Also called take-home pay.

Income Tax

Tax on taxable income after allowances. England, Wales, and Northern Ireland share bands for many employees; Scotland has its own bands and rates.

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: student loan · 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.