Given that the builder has owned the site for years I will fall into option 2.
Vanilla said:If the builder is selling a house rather than a site plus building agreement, then the 25% rule doesnt apply at all. You are then looking at stamp duty on the entire figure ( less VAT if applicable), which as a non first time buyer would be at 7.5%. You would really want to check the mechanism with your solicitor as if the house was not substantially complete when you agreed to buy the builder could well have been selling by way of site plus building agreement which would be a substantial tax saving for you.
If the area of the house or flat is greater than 125 sq. metres (1,346 sq. feet), some stamp duty is payable if the Chargeable Consideration is above the relevant exemption threshold. (The stamp duty is assessed on either the cost of the site or 25% of the cost of the site plus the building costs (less VAT), whichever is the greater figure. This figure is called the Chargeable Consideration.
*my boldNew houses or apartments which are purchased by an owner occupier (including a first time buyer) where the total floor area exceeds 125 square metres are charged with duty, at the appropriate residential property rate as per the table above, on the site value (excluding VAT) or one quarter of the total value of the house including the site (excluding VAT)*, whichever is the greater, subject to clawback.The size of the floor area must be certified by a qualified architect, engineer or surveyor
Stamp Duty new build which is over the floor area limit
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