Stamp Duty Explained

What Is Stamp Duty?

Stamp Duty (known as Stamp Duty Land Tax, or SDLT) is a government tax on property purchases over £125,000 in England and Northern Ireland. It funds the legal registration of land ownership at HM Land Registry, and must be paid before HMRC issues the necessary certificate.

For official information and to use the government calculator, visit: GOV.UK Stamp Duty Land Tax.

Standard Residential Rates

For a primary residence, you pay Stamp Duty on the portion of the purchase price that falls within each band:

• 0% on the first £125,000
• 2% on £125,001–£250,000
• 5% on £250,001–£925,000
• 10% on £925,001–£1,500,000
• 12% on any amount above £1,500,000

Example: On a £295,000 purchase, you pay 0% on £125k, 2% on the next £125k (£2,500), and 5% on the final £45k (£2,250), for a total SDLT of £4,750.

First‑Time Buyer Relief

If you’ve never owned property and your purchase price is ≤ £500,000:

• 0% on the first £300,000
• 5% on £300,001–£500,000
• No relief above £500,000

Additional/Investment Properties

Buying a second home or buy‑to‑let property incurs a 3% surcharge on each band, making the effective rates:

• 5% on £0–£125,000
• 7% on £125,001–£250,000
• 10% on £250,001–£925,000
• 15% on £925,001–£1,500,000
• 17% on amounts over £1,500,000

Scotland & Wales

Scotland: Land & Buildings Transaction Tax (LBTT) applies from £145,000—see HMRC guidance for rates.
Wales: Land Transaction Tax (LTT) applies from £225,000—different bands and rates, see Welsh Government for details.

How & When to Pay

You must file your SDLT return and pay the tax within 14 days of completion. Your solicitor or conveyancer typically handles this, adding the tax to their fees. Late payment incurs interest and penalties.

Non‑Residential & Mixed Use

For commercial or mixed‑use purchases above £150,000, you pay:

• 0% on the first £150,000
• 2% on £150,001–£250,000
• 5% on amounts above £250,000

Shared Ownership

You can pay SDLT upfront on the full market value (“market value election”), or in stages based on each lease premium; relief may apply if you’re a first‑time buyer on the first share.

Reliefs & Exemptions

• No SDLT on transfers on divorce, gifts, or wills
• Exempt if no money changes hands or lease <7 years under threshold
• First‑time buyer relief, Right to Buy, and certain charities or employers

Refunds

You may claim a refund if you overpaid—for example, you sold your previous main home within 36 months, became UK‑resident after paying a surcharge, or made an error on your original SDLT return.

Typical Timeline

• Conveyancer files SDLT return on completion day
• HMRC processes return—usually within days
• Refund claims processed within 12 months if eligible