What is Stamp Duty?
In England & Northern Ireland you are taxed when you buy a residential property, or a piece of land, this is called stamp duty. On 31st March 2025 the UK Government are introducing new lower threshold bands on all SDLT transactions which will replace the current rates. You can calculate both sets of rates and see the difference using the dropdown menu option.
Stamp duty tax applies to freehold and leasehold properties, regardless of buying outright or with a mortgage. Buying a property in Scotland? you pay Land and Buildings Transaction Tax (LBTT), in Wales: Land Transaction Tax (LTT) instead of Stamp Duty. UK Gov website source
How is stamp duty calculated?
There are several rate bands for Stamp Duty. Similar to PAYE taxation, stamp duty is calculated by dividing the property sale price into tiers, each tier's taxation rate increases into higher rate bands as the property/land value increases.
First time buyers
First time buyers in England or Northern Ireland will pay no Stamp Duty on properties worth up to £425,000. To qualify you must be purchasing your only or main residence and have never owned a freehold previously in the UK or overseas.
If you are a first time buyer and the property purchased is over £625,000, the standard stamp duty rates apply and you will not qualify for first time buyers tax relief.
Second homes / buy to let
Purchases of additional residential properties: second homes and buy-to-let properties pay an extra 3% in stamp duty on top of standard rates for each tier. The additional rate applies to all tiers! Caravans, mobile and motorhomes are not included.
In the situation you end up owning two properties, such as a delay in selling a previous residence, then the higher stamp duty rates apply. You can however apply for a refund of any additional tax you would have had to pay, providing you sell the previous main residence within 3 years and apply for the refund within 3 months of the previous main residence's sale.
2024 Stamp Duty (SDLT) rates
Standard SDLT rates will apply to anyone purchasing property who doesn't fall into the first-time buyer or second home/buy to let categories.source
The standard rates are as follows:
£0-£250,000 = 0% tax
£250,001 - £925,000 = 5% tax
£925,001 - £1.5m = 10% tax
£1.5m+ = 12% tax
Add an additonal 5% extra tax (UK October Budget adjusted) to each band for a second/additional home such as a BTL. These rates apply only to the part of the property price falling into each tier.
In the situation you end up owning two properties, such as a delay in selling a previous residence, then the higher stamp duty rates apply. You can however apply for a refund of any additional tax you would have had to pay, providing you sell the previous main residence within 3 years and apply for the refund within 3 months of the previous main residence's sale.
2025 Stamp Duty (SDLT) rates
The following will come into effect from 31st March 2025
£0-£125,000 = 0% tax
£125,001-£250,000 = 2% tax
£250,001 - £925,000 = 5% tax
£925,001 - £1.5m = 10% tax
£1.5m+ = 12% tax
Add an additonal 5% extra tax (UK October Budget adjusted) to each band for a second/additional home such as a BTL. These rates apply only to the part of the property price falling into each tier.
2024 First Time Buyer Stamp Duty (SDLT) rates
£0-£425,000 = 0% tax
£425,001-£625,000 = 5% tax
First time buyer purchases over £625,000 do not qualify for tax relief and standard SDLT rates apply.
2025 First Time Buyer Stamp Duty (SDLT) rates
The following will come into effect from 31st March 2025
£0-£300,000 = 0% tax
£300,001-£500,000 = 5% tax
From 31st March 2025 first time buyer purchases over £500,000 do not qualify for tax relief and standard SDLT rates apply.
When does Stamp Duty have to be paid?
Payment is usually made within 30 days of completion of a property. The paperwork for this is normally handled by your solicitor or conveyancer.
