What Stamp Duty is
Stamp Duty Land Tax (SDLT) is a tax on buying land or property in England and Northern Ireland. You pay it whether you buy with a mortgage or in cash, and whether the home is new or old. Scotland and Wales have their own taxes instead.
It is worked out on the price you pay, called the chargeable consideration. Your solicitor or conveyancer usually files the return and pays HMRC for you, from money you provide at completion.
Rates for home movers
Stamp Duty is a slice tax. The price is split into bands and each rate applies only to the part of the price inside its band. Paying more never increases the tax on the slices below.
| Part of the price | Rate |
|---|---|
| Up to £125,000 | 0% |
| £125,001 to £250,000 | 2% |
| £250,001 to £925,000 | 5% |
| £925,001 to £1,500,000 | 10% |
| Above £1,500,000 | 12% |
These rates are unchanged for 2026/27 and apply to anyone buying a main home who is not a first-time buyer.
A worked example
- First £125,000 at 0%£0
- Next £125,000 at 2%£125,001 to £250,000£2,500
- Last £45,000 at 5%£250,001 to £295,000£2,250
That is 1.61% of the price. Each extra £1,000 above £250,000 adds £50 of tax, until the 10% band starts at £925,000.
First-time buyers
If every buyer is a first-time buyer and the price is £500,000 or less, you pay nothing on the first £300,000 and 5% on the part from £300,001 to £500,000. Above £500,000 the relief is lost completely and the standard rates apply.
| Price | First-time buyer | Home mover | Saving |
|---|---|---|---|
| £250,000 | £0 | £2,500 | £2,500 |
| £300,000 | £0 | £5,000 | £5,000 |
| £400,000 | £5,000 | £10,000 | £5,000 |
| £500,000 | £10,000 | £15,000 | £5,000 |
| £500,001 | £15,000 | £15,000 | £0 |
Our first-time buyer calculator covers the rules, joint buyers and Lifetime ISAs in more detail.
Second homes and buy-to-let
If you will own two or more homes after buying, and the new one is not replacing your main home, you pay the higher rates: the standard rates plus a 5% surcharge on every band, from the first pound. The surcharge rose from 3% to 5% on 31 October 2024.
| Part of the price | Rate |
|---|---|
| Up to £125,000 | 5% |
| £125,001 to £250,000 | 7% |
| £250,001 to £925,000 | 10% |
| £925,001 to £1,500,000 | 15% |
| Above £1,500,000 | 17% |
- Standard Stamp Duty£1,500
- 5% surcharge on £200,000£10,000
The higher rates do not apply to homes bought for less than £40,000. Married couples and civil partners are treated as one: if your spouse owns a home, so do you for this test. Homes owned anywhere in the world count.
Getting the surcharge back
If you buy a new main home before selling your old one, you pay the higher rates on completion. If you then sell your previous main home within 3 years, you can claim the surcharge back from HMRC.
- Day 1Buy your new main home
Pay Stamp Duty at the higher rates.
- Within 3 yearsSell your old main home
It must have been your main home at some point in the 3 years before the purchase.
- After the saleClaim the refund
Apply online, usually within 12 months of the sale. HMRC refunds the surcharge.
On a £400,000 home the surcharge is £20,000, so the refund is worth having in the diary.
Buyers from outside the UK
A further 2% surcharge applies if you have not been present in the UK for at least 183 days in the 12 months before buying. It is added on top of whichever rates apply to you, including the higher rates for additional homes. A non-resident home mover buying for £300,000 would pay £5,000 plus £6,000: £11,000.
If you then spend 183 days in the UK in a 365-day period around the purchase, you may be able to claim the 2% back.
Ready reckoner
| Price | Home mover | First-time buyer | Second home |
|---|---|---|---|
| £200,000 | £1,500 | £0 | £11,500 |
| £250,000 | £2,500 | £0 | £15,000 |
| £300,000 | £5,000 | £0 | £20,000 |
| £350,000 | £7,500 | £2,500 | £25,000 |
| £400,000 | £10,000 | £5,000 | £30,000 |
| £500,000 | £15,000 | £10,000 | £40,000 |
| £750,000 | £27,500 | £27,500 | £65,000 |
| £1,000,000 | £43,750 | £43,750 | £93,750 |
| £2,000,000 | £153,750 | £153,750 | £253,750 |
Effective rates
The effective rate is the total tax as a share of the price. For a home mover it rises steadily:
| Price | Stamp Duty | Effective rate |
|---|---|---|
| £300,000 | £5,000 | 1.67% |
| £500,000 | £15,000 | 3.00% |
| £925,000 | £36,250 | 3.92% |
| £1,000,000 | £43,750 | 4.38% |
| £2,000,000 | £153,750 | 7.69% |
Leasehold, shared ownership and new builds
Buying an existing lease. Most leasehold flats are bought for a price (premium) with a low ground rent. Stamp Duty is worked out on the premium using the normal rates.
New leases with significant rent. Where a new lease has a large rent, Stamp Duty can also be due on the net present value of the rent above £125,000, at 1%. This is unusual for normal home purchases.
Shared ownership. You can pay on the share you buy, or elect to pay on the full market value up front. Our shared ownership calculator compares both.
New builds. The rates are the same. If the developer pays your Stamp Duty as an incentive, the tax is still worked out on the price.
Gifts, divorce and companies
- Gifts
- If no money or mortgage changes hands
- Inheritance
- Inheriting a home
- Divorce
- Transfers under a court order or agreement
- Taking on a mortgage
- The debt you take on counts as the price
- Buying a share
- Buying out a co-owner
- Companies
- 17% on homes over £500,000, unless a relief applies
Buying several homes in one transaction used to qualify for multiple dwellings relief, but that relief was abolished from June 2024.
Filing and paying
The SDLT return must be filed and the tax paid within 14 days of completion. Your conveyancer normally does this, using money you send before completion. A return is needed for most purchases over £40,000, even if no tax is due. HMRC charges penalties and interest for late returns and payments.
Budget for it in cash
Stamp Duty cannot normally be added to your mortgage. Have it ready alongside your deposit and fees. Our moving costs calculator adds everything up.
Paying no more than you owe
- Furniture and fittings. Movable items, such as curtains, free-standing appliances and furniture, are not taxed. If included in the price they can be listed at a fair value. Inflating them is evasion.
- Thresholds. There are no cliff edges for home movers, but there is one at £500,000 for first-time buyers, where an extra £1 costs £5,000.
- Sell first if you can, to avoid paying the higher rates and waiting for a refund.
- Check your status. Make sure relief or the main residence rules are applied correctly.
Beware of avoidance schemes
Schemes that promise to cut or remove Stamp Duty through complex arrangements are challenged by HMRC, and buyers end up paying the tax plus interest and penalties.
How the rates have changed
- December 2014Slice system introduced
Each rate applies only to the part of the price in its band.
- April 20163% surcharge on additional homes
- April 20212% non-resident surcharge
- September 2022Temporary cut
The 0% band rose to £250,000, and £425,000 for first-time buyers.
- October 2024Surcharge rises to 5%
- April 2025Temporary cut ends
The 0% band returned to £125,000, and £300,000 for first-time buyers.
Scotland and Wales
Scotland charges Land and Buildings Transaction Tax and Wales charges Land Transaction Tax, each with different bands and surcharges. For a home mover at £300,000: £5,000 in England, £4,600 in Scotland and £4,500 in Wales. Our LBTT and LTT calculators cover them.
Example: buying before you sell
Sam and Alex buy their next home for £400,000 before their flat has sold. On completion day they own two homes, so the higher rates apply.
- Stamp Duty at the higher ratesPaid within 14 days of completion£30,000
- Stamp Duty at the standard rates£10,000
They need the full £30,000 at completion. When their flat sells five months later, they claim £20,000 back from HMRC. If the flat had not sold within 3 years, the refund would be lost.
Who counts as a first-time buyer
For Stamp Duty you are a first-time buyer only if you have never owned a home, or a share of one, anywhere in the world, and you will live in the new home as your main residence. Every buyer must qualify.
Inherited shares of homes, homes owned with a former partner and homes abroad all count as owning before. Having had a mortgage is not the test; owning is. A parent who helps with a gifted deposit but is not buying does not affect your relief.
Mixed-use and non-residential property
Property that is partly residential and partly commercial, such as a flat above a shop, or a home with a substantial commercial element, can use the non-residential rates:
| Part of the price | Rate |
|---|---|
| Up to £150,000 | 0% |
| £150,001 to £250,000 | 2% |
| Above £250,000 | 5% |
HMRC looks closely at mixed-use claims on homes with a paddock, woodland or annexe, and many have been rejected at tribunal. A large garden does not make a home mixed-use.
Stamp Duty and your deposit
Stamp Duty comes on top of your deposit, and lenders will not usually lend to cover it. A home mover buying for £400,000 with a 10% deposit needs £40,000 for the deposit and £10,000 for Stamp Duty, before legal fees and removals.
If cash is tight, you could put down a slightly smaller deposit to keep money back for the tax, but check that this does not push you into a higher loan-to-value band with a worse rate.