How it works
The 2025/26 Stamp Duty bands
Stamp Duty Land Tax applies in England and Northern Ireland. Scotland has its own tax (Land and Buildings Transaction Tax) and Wales has Land Transaction Tax. The bands below apply to residential purchases completed on or after 1 April 2025 — the temporary higher thresholds that applied in 2022–2025 ended.
| Band | Main residence rate | Additional property rate |
|---|---|---|
| Up to £125,000 | 0% | 5% |
| £125,001 – £250,000 | 2% | 7% |
| £250,001 – £925,000 | 5% | 10% |
| £925,001 – £1.5m | 10% | 15% |
| Above £1.5m | 12% | 17% |
How Stamp Duty is actually calculated
SDLT is a slab-free, banded tax — you pay each band's rate only on the slice of the price that falls in that band. It is not a single percentage on the whole purchase.
Worked example: £400,000 main residence
First £125,000 × 0% = £0
Next £125,000 × 2% = £2,500
Remaining £150,000 × 5% = £7,500
Total SDLT = £10,000 — an effective rate of 2.5%.
Worked example: £400,000 first-time buyer
First £300,000 × 0% = £0
Next £100,000 × 5% = £5,000
Total SDLT = £5,000 — half of what a regular main-residence buyer pays.
Worked example: £400,000 second home
First £125,000 × 5% = £6,250
Next £125,000 × 7% = £8,750
Remaining £150,000 × 10% = £15,000
Total SDLT = £30,000 — the 5% surcharge bites hard.
First-time buyer relief
To qualify, you must be buying your first ever residential property (worldwide), intend to live in it, and the price must be £500,000 or less. If it's above £500,000, no relief applies and you pay the standard rates.
Joint buyers both need to be first-time buyers. If one partner has previously owned, you cannot claim the relief.
The 5% surcharge on additional property
If, on the day of completion, you own (or part-own) another residential property anywhere in the world, and you're not replacing your main home, the 5% additional rate applies on every band. This catches buy-to-let investors, second homes and anyone caught in a simultaneous completion.
The surcharge can be reclaimed if you sell your previous main residence within 36 months of the new purchase — a useful safety valve when chains break down.
When and how SDLT is paid
Your solicitor files the SDLT return and pays the tax to HMRC within 14 days of completion. It's usually handled as part of completion monies — you don't need to do anything yourself, but it must sit in the solicitor's client account when you exchange.
Common misunderstandings
- "If I offer £1 less, I drop a band." — No. SDLT is banded, not slab. A £250,000 offer versus £250,001 saves you 5p, not thousands.
- "My flat abroad doesn't count." — It does. Any residential property you own worldwide triggers the 5% surcharge on a UK additional-property purchase.
- "New builds are exempt." — Not true. New builds pay the same SDLT. Some developers offer to pay it for you as part of an incentive.
- "Buying with my partner — I'm a first-time buyer." — The relief requires both buyers to be first-time buyers. One previous owner means no relief.