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Understanding Stamp Duty Land Tax in the UK
Stamp Duty Land Tax (SDLT) is one of the largest upfront costs when buying a property in England or Northern Ireland. Whether you are a first-time buyer stepping onto the ladder, a home mover upgrading, or purchasing a buy-to-let investment, understanding exactly how much stamp duty you will owe is essential for budgeting. The tax is calculated on a progressive, banded system — similar to income tax — meaning you only pay each rate on the portion of the price that falls within that band, not on the entire purchase price.
Current Stamp Duty Rates for 2026
Following the end of the temporary higher thresholds on 1 April 2025, the standard SDLT bands for residential property purchases in England and Northern Ireland are:
- £0 – £125,000: 0% (no stamp duty)
- £125,001 – £250,000: 2%
- £250,001 – £925,000: 5%
- £925,001 – £1,500,000: 10%
- Over £1,500,000: 12%
For example, if you buy a property for £350,000 as a home mover, you pay nothing on the first £125,000, then 2% on the next £125,000 (£2,500) and 5% on the remaining £100,000 (£5,000) — a total of £7,500 in stamp duty, giving an effective rate of around 2.14%.
First-Time Buyer Relief
First-time buyers benefit from a valuable SDLT relief. If the property costs £500,000 or less, you pay no stamp duty on the first £300,000 and just 5% on the portion between £300,001 and £500,000. That means a first-time buyer purchasing at £350,000 pays only £2,500 in stamp duty — saving £5,000 compared with standard rates. If the property price exceeds £500,000, first-time buyer relief does not apply at all and you pay the full standard rates. To qualify, neither you nor anyone you are buying with can have previously owned a property anywhere in the world.
The 5% Additional Property Surcharge
Since October 2024, buyers purchasing a second home, holiday let or buy-to-let investment property pay a 5% surcharge on top of the standard rates on every band. This applies if you already own a residential property anywhere in the world at the time of purchase. The surcharge was increased from the previous 3% level, significantly raising the upfront cost of property investment. On a £250,000 buy-to-let purchase, the surcharge alone adds £12,500 to your stamp duty bill.
Non-UK Resident Surcharge
Buyers who are not UK-resident face an additional 2% surcharge on all SDLT bands. You are classed as non-resident if you have spent fewer than 183 days in the UK during the 12 months before your purchase. This surcharge applies on top of both the standard rates and the additional property surcharge where applicable, making it potentially very expensive for overseas investors.
Stamp Duty as Part of Your Total Buying Costs
Stamp duty is just one piece of the cost puzzle when buying a home. You should also budget for solicitor or conveyancer fees (typically £1,000–£2,000), a survey (£300–£700 depending on the type), mortgage arrangement fees (often £500–£1,500), removal costs, and any immediate repairs or renovations. As a rough guide, total buying costs excluding the deposit typically come to between 3% and 7% of the purchase price — with stamp duty making up the largest share for properties above £250,000.
How to Pay Stamp Duty
Your solicitor or conveyancer normally handles the SDLT return and payment on your behalf. The tax must be filed and paid to HMRC within 14 days of completion. If it is late, HMRC can charge penalties and interest. You cannot complete the registration of your property at the Land Registry until the SDLT return has been filed, so prompt payment protects your legal ownership. Most lenders will not allow you to add stamp duty to your mortgage, so you need to have this money available from your own savings at completion alongside your deposit.
What is stamp duty and who pays it?
Stamp Duty Land Tax (SDLT) is a government tax paid by the buyer when purchasing a residential property in England or Northern Ireland above a certain threshold. The current nil-rate threshold is £125,000 — you pay no stamp duty on properties at or below this price. Above this threshold, SDLT is charged on a progressive banded system, with rates ranging from 2% to 12%. Your solicitor handles the payment, which must reach HMRC within 14 days of completion.
What are the stamp duty rates for 2026?
The current SDLT rates for standard residential purchases in England and Northern Ireland are: 0% on the first £125,000, 2% on £125,001 to £250,000, 5% on £250,001 to £925,000, 10% on £925,001 to £1,500,000, and 12% on anything above £1,500,000. These are progressive bands — you only pay each rate on the portion of the price within that band, not on the entire purchase price.
How much stamp duty do first-time buyers pay?
First-time buyers benefit from SDLT relief if the property costs £500,000 or less. You pay no stamp duty on the first £300,000 and 5% on the portion between £300,001 and £500,000. For a property at £350,000, that means just £2,500 in stamp duty. If the property exceeds £500,000, first-time buyer relief is not available and you pay the full standard rates. Both buyers in a joint purchase must be first-time buyers to qualify.
What is the additional property surcharge?
If you already own a residential property anywhere in the world and are buying another — whether a second home, holiday let or buy-to-let — you pay a 5% surcharge on top of the standard SDLT rates across every band. This surcharge was increased from 3% to 5% in October 2024. On a £300,000 purchase, the surcharge adds £15,000 to your stamp duty bill. If you sell your previous main residence within 36 months, you can apply for a refund of the surcharge.
Can I get a stamp duty refund if I sell my old home?
Yes. If you paid the additional property surcharge because you owned two homes at the point of purchase, you can claim a refund from HMRC if you sell your previous main residence within 36 months of buying the new one. The refund must be claimed within 12 months of the sale of the old property, or within 12 months of filing the SDLT return, whichever is later. Your solicitor can help you with the application.
When do I have to pay stamp duty?
Stamp duty must be paid to HMRC within 14 days of the completion date — the day the property legally becomes yours and the purchase funds are transferred. Your solicitor or conveyancer will normally file the SDLT return and arrange payment on your behalf from the funds held on completion. Late filing attracts automatic penalties and daily interest charges from HMRC.
Can I add stamp duty to my mortgage?
Most UK lenders do not allow you to add stamp duty to your mortgage. You will need to pay it from your own savings at completion, separate from your deposit. A small number of specialist lenders may allow it in certain circumstances, but this increases your overall borrowing and monthly repayments. It is best to budget for stamp duty alongside your deposit from the start of your saving plan.
Does stamp duty apply in Scotland and Wales?
No — England and Northern Ireland use SDLT, but Scotland has its own Land and Buildings Transaction Tax (LBTT) and Wales has Land Transaction Tax (LTT). Both operate on similar banded systems but with different thresholds and rates. This calculator covers England and Northern Ireland only. If you are buying in Scotland or Wales, check the respective government websites for their current rates.
Is stamp duty different for new-build properties?
New-build properties are subject to the same SDLT rates as existing homes. However, some developers offer stamp duty incentives — such as paying it on your behalf — as part of their marketing packages. First-time buyer relief also applies to new builds provided the purchase price is £500,000 or less. If you are buying through a shared ownership scheme, you may have the option to pay stamp duty only on your initial share or on the full market value — your solicitor can advise on which is more beneficial.
How much stamp duty will I pay on a £300,000 house?
On a £300,000 property as a standard home mover, you would pay: 0% on the first £125,000 (£0), 2% on £125,001 to £250,000 (£2,500), and 5% on £250,001 to £300,000 (£2,500) — a total of £5,000 (effective rate 1.67%). A first-time buyer would pay £0 because the entire price falls within the £300,000 nil-rate band. An additional property buyer would pay £5,000 plus the 5% surcharge across all bands (£15,000), totalling £20,000.
Are there any stamp duty exemptions?
Some transactions are exempt from stamp duty or subject to reduced rates. Properties transferred as part of a divorce or dissolution of a civil partnership are exempt. Inherited properties do not attract stamp duty. Transfers to charities qualify for relief, as do certain purchases of multiple dwellings (Multiple Dwellings Relief). Crown employees and members of the armed forces returning from overseas postings may also qualify for relief on the non-resident surcharge. Your solicitor can confirm whether any relief applies to your purchase.
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