How much stamp duty do you pay when
you buy a property?

How SDLT works — rates and thresholds for 2025/26

Stamp Duty Land Tax is a tiered tax on property purchases in England and Northern Ireland. Unlike a flat-rate tax, SDLT is calculated on each portion of the purchase price that falls within each band. This means a £600,000 property is not taxed at a single rate– instead, each slice of the price is taxed at the rate applicable to that band.

For standard residential purchases by non-first-time buyers, the 2025/26 rates apply as follows: 0% on the first £250,000, 5% on the portion from £250,001 to £925,000, 10% from £925,001 to £1,500,000, and 12% on anything above £1,500,000. First-time buyers benefit from a more generous nil-rate band, while additional property purchases attract a 3% surcharge across all bands.

First-time buyer relief — who qualifies and how much you save

First-time buyers pay no SDLT on the first £300,000 of a property's price, then 5% on the portion between £300,000 and £500,000. For a property priced at £450,000, this means paying £7,500 instead of the £10,000 a non-first-time buyer would owe – a saving of £2,500.

To qualify, you must never have previously owned a property anywhere in the world. This includes inherited property, property owned abroad, and property acquired through a trust. If the property price exceeds £500,000, first-time buyer relief is not available at all – standard rates apply to the entire purchase price with no relief whatsoever. This creates a significant cliff edge that buyers should be aware of.

Additional property surcharge — second homes and buy-to-let

If you are buying a second home, buy-to-let property, or any additional residential property, a 3% surcharge applies on top of all standard SDLT bands. This surcharge applies even if your main home is abroad, and regardless of whether you intend to rent the property or use it as a holiday home.

The surcharge can be substantial: on a £400,000 buy-to-let property, the 3% surcharge adds £12,000 to the standard £7,500 SDLT bill, bringing the total to £19,500. However, if you sell your previous main home within three years of completing the additional purchase, you may be able to claim a full refund of the extra 3%. Claims must be submitted within two years of the sale date.

Be aware that inheriting a residential property counts as owning a previous home. If you subsequently buy another property, the 3% surcharge applies – even if you did not choose to own the inherited property and have no intention of keeping it.

Common mistakes when calculating stamp duty

SDLT is one of the most misunderstood property taxes. The mistakes below cost buyers thousands – either through overpayment, missed relief, or unexpected liability.

Calculating on the total price, not on bands. SDLT is calculated on each portion of the price within each band – not on the total price at a single flat rate. A £600,000 property is not entirely taxed at 10%.

Assuming first-time buyer relief applies above £500,000. Relief is only available for properties up to £500,000. Above this threshold, standard rates apply to the entire purchase price with no relief at all – a significant cliff edge.

Missing the 3% surcharge on inherited properties. Inheriting a residential property counts as owning a previous home. If you subsequently buy another property, the 3% surcharge applies – even if you did not choose to own the inherited property.

Not claiming back the surcharge after selling a previous home. If you bought an additional property paying the 3% surcharge, and you sell your previous main home within 3 years, you can claim a full refund of the extra 3%. Claims must be made within 2 years of selling.

Miscategorising mixed-use property.A property with any commercial element (shop below flat, doctor's surgery in part of a house) is classified as non-residential and uses the commercial SDLT rates – which are lower. Buyers sometimes pay residential SDLT on mixed-use property unnecessarily.

Filing and payment deadlines — 14 days to act

SDLT must be paid and a return filed with HMRC within 14 days of completion. Your solicitor or conveyancer typically handles this on your behalf. Failure to file and pay within 14 days triggers automatic penalties and interest – a £100 penalty for returns up to 3 months late, rising to £200 for returns over 3 months late, plus interest on the unpaid tax.

For purchases in Scotland, the equivalent tax is Land and Buildings Transaction Tax (LBTT), administered by Revenue Scotland. In Wales, Land Transaction Tax (LTT) is administered by the Welsh Revenue Authority. Both use different rates and thresholds – this calculator covers England and Northern Ireland only.