Stamp Duty Land Tax (SDLT) is one of the largest costs of buying property in England and Northern Ireland — yet many buyers do not find out how much they owe until late in the purchase process. Understanding stamp duty before you start searching can significantly affect your budget.
This guide covers the 2025/26 SDLT rates in full, including first-time buyer relief, additional property surcharge, and worked examples for different purchase scenarios.
Stamp Duty Land Tax (SDLT) applies in England and Northern Ireland. Scotland has Land and Buildings Transaction Tax (LBTT) and Wales has Land Transaction Tax (LTT) — the rates differ. This guide covers SDLT only.
2025/26 Stamp Duty Rates — Standard Residential
Stamp duty is charged on a banded basis — you pay each rate only on the portion of the purchase price that falls within each band.
| Purchase Price Band | SDLT Rate | |---|---| | Up to £250,000 | 0% | | £250,001 to £925,000 | 5% | | £925,001 to £1,500,000 | 10% | | Over £1,500,000 | 12% |
🏠Worked Example — Standard Purchase at £400,000
On a £400,000 property purchase, stamp duty is calculated as follows:
| Band | Amount in Band | Rate | Tax | |---|---|---|---| | Up to £250,000 | £250,000 | 0% | £0 | | £250,001 to £400,000 | £150,000 | 5% | £7,500 | | Total SDLT | | | £7,500 |
Your effective stamp duty rate on this purchase is 1.875% (£7,500 ÷ £400,000 × 100).
First-Time Buyer Relief
First-time buyers receive a significant reduction in stamp duty, subject to conditions.
Current first-time buyer relief rates (2025/26):
| Purchase Price Band | SDLT Rate | |---|---| | Up to £425,000 | 0% | | £425,001 to £625,000 | 5% | | Over £625,000 | Standard rates apply (no relief) |
First-time buyer relief only applies if you have never owned residential property anywhere in the world — not just in the UK. If you have previously owned property abroad, you do not qualify.
Example: First-time buyer purchasing at £500,000
| Band | Amount | Rate | Tax | |---|---|---|---| | Up to £425,000 | £425,000 | 0% | £0 | | £425,001 to £500,000 | £75,000 | 5% | £3,750 | | Total SDLT | | | £3,750 |
Without first-time buyer relief, this purchase would incur £12,500 in stamp duty. The relief saves £8,750 in this example.
Additional Property Surcharge (Buy-to-Let and Second Homes)
If you are purchasing an additional residential property — including buy-to-let investments and second homes — you pay the standard rates plus a 3% surcharge on each band.
| Purchase Price Band | Standard Rate | Additional Property Rate | |---|---|---| | Up to £250,000 | 0% | 3% | | £250,001 to £925,000 | 5% | 8% | | £925,001 to £1,500,000 | 10% | 13% | | Over £1,500,000 | 12% | 15% |
Example: Buy-to-let purchase at £250,000
| Band | Amount | Rate | Tax | |---|---|---|---| | Up to £250,000 | £250,000 | 3% | £7,500 | | Total SDLT | | | £7,500 |
The same property bought as a primary residence would incur £0 in stamp duty.
The additional property surcharge applies even if your current home is rented out rather than owned. If you own any residential property anywhere in the world, the 3% surcharge applies to any new residential purchase in England and Northern Ireland.
When Is Stamp Duty Paid?
Stamp duty must be paid and a return submitted to HMRC within 14 days of completion. Your solicitor or conveyancer typically handles this on your behalf and will include the SDLT amount in their completion statement.
If you miss the 14-day deadline, you face automatic late filing penalties and interest on the unpaid amount.
Stamp Duty Exemptions and Reliefs
Several situations allow for reduced or zero stamp duty:
Zero SDLT situations:
- Property purchased for under £40,000
- Transfer of property between spouses or civil partners (in most circumstances)
- Property left in a will (no SDLT on inheritance)
- Property purchased by a registered charity for charitable purposes
Reduced SDLT situations:
- First-time buyer relief (as above)
- Multiple dwellings relief (when buying several properties in one transaction)
- Mixed use property (part residential, part commercial — commercial rates apply, which are lower)
Can You Reclaim Stamp Duty?
In some circumstances, yes:
Replacing a main residence. If you buy a new main residence before selling your old one, you pay the additional property surcharge (3%) at completion. If you sell your previous main residence within 3 years of completion, you can apply to HMRC for a refund of the 3% surcharge.
First-time buyer relief overpayment. If you were incorrectly charged the full rate instead of first-time buyer rates, you can amend your SDLT return within 12 months of the filing deadline.
Stamp Duty and Property Investment
For property investors, stamp duty represents a significant upfront cost that affects both cash flow and overall returns. On a £300,000 buy-to-let property, the additional 3% surcharge adds £9,000 to the purchase cost compared to a standard residential purchase.
This needs to be factored into your investment calculations from the start — not discovered at completion.
📊When assessing a buy-to-let purchase, always include:
- Full purchase price
- Stamp duty (including the 3% surcharge)
- Solicitor and conveyancing fees (£1,500–£3,000 typically)
- Survey costs (£400–£1,500)
- Any immediate renovation costs
- Ongoing costs (mortgage, insurance, maintenance, agent fees, void periods)
Only then can you accurately calculate your expected yield and decide whether the investment makes sense.
Stamp Duty on Commercial Property
If you are purchasing a commercial property or mixed-use property, different SDLT rates apply:
| Price | SDLT Rate | |---|---| | Up to £150,000 | 0% | | £150,001 to £250,000 | 2% | | Over £250,000 | 5% |
Commercial SDLT rates are generally lower than residential rates, which is one reason why mixed-use properties can sometimes be advantageous from a tax perspective.
Planning Ahead — Budgeting for Stamp Duty
When planning a property purchase, always calculate your expected stamp duty before making an offer. On a £500,000 property purchase (standard rates), stamp duty is £12,500 — a significant sum that needs to be available on top of your deposit and other purchase costs.
Many buyers underestimate the total purchase costs because they focus on the deposit and forget the transaction costs — typically 2–4% of the purchase price when you include stamp duty, legal fees, survey, and moving costs.
🏠Last updated April 2026 based on 2025/26 SDLT rates. Tax rules may change — always verify with HMRC or a qualified property solicitor before completing any purchase.