SDLT Guide: Stamp Duty Land Tax UK 2025/26 — Rates, Bands, First-Time Buyer Relief and How to Calculate What You Owe

Stamp Duty Land Tax is a tax charged by HMRC on the purchase of land or property in England and Northern Ireland above a certain price threshold. It applies when you buy a freehold property, a new or existing leasehold, a property through a shared ownership scheme, or when land or property is transferred in exchange for payment (for example, taking on a mortgage).

SDLT does not apply in Scotland, where buyers pay Land and Buildings Transaction Tax (LBTT), or in Wales, where Land Transaction Tax (LTT) applies to completions from 1 April 2018 onwards. The rates, bands and reliefs differ in each nation, so it is important to check which regime applies to your purchase.

You must submit an SDLT return to HMRC and pay the tax within 14 days of completion. Your solicitor or conveyancer will usually handle this on your behalf and add the cost to their fees. Failing to file and pay within the deadline can result in penalties and interest charges. For more details, see our guide on first-time buyer mortgages.

SDLT is calculated on a progressive, slice-based system — similar to income tax. You pay different rates on each portion of the purchase price that falls within a given band, not a single flat rate on the whole amount.

The standard residential rates from 1 April 2025 are:

• Up to £125,000: 0%
• £125,001 to £250,000: 2%
• £250,001 to £925,000: 5%
• £925,001 to £1,500,000: 10%
• Above £1,500,000: 12%

For example, if you buy a house for £295,000 in April 2025, your SDLT bill is calculated as follows: 0% on the first £125,000 (£0), plus 2% on the next £125,000 (£2,500), plus 5% on the remaining £45,000 (£2,250) — giving a total SDLT bill of £4,750. Under the previous temporary thresholds, that same purchase would have attracted just £2,250 in SDLT. For more details, see our guide on Help to Buy (gov.uk/lifetime-isa) alternatives.

First-time buyers benefit from a dedicated relief that raises the nil-rate threshold to £300,000. If the property costs £500,000 or less, you pay no SDLT on the first £300,000 and 5% on the portion between £300,001 and £500,000.

If the purchase price exceeds £500,000, first-time buyer relief is not available and you pay SDLT at the standard rates instead. To qualify, both you and anyone you are buying with must never have previously owned a residential property anywhere in the world.

Worked example: A first-time buyer purchases a flat for £425,000. They pay 0% on the first £300,000 (£0) and 5% on the remaining £125,000 (£6,250), for a total SDLT bill of £6,250. Without the relief, the same purchase at standard rates would cost £11,250 in SDLT — a saving of £5,000.

The relief was introduced in November 2017 and temporarily expanded in September 2022, raising the threshold to £425,000 and the cap to £625,000. Those temporary limits expired on 31 March 2025, returning to the current £300,000/£500,000 thresholds. For buyers in London and the South East, where average prices regularly exceed £500,000, this means the relief is often unavailable. For more details, see our guide on buy-to-let mortgages.

You may also find our guide to Child Benefit UK 2025/26 useful.

If you are buying a residential property and you will own more than one at the end of the day of purchase, you must pay a 5% surcharge on top of the standard SDLT rates. This applies to buy-to-let investments, second homes and any additional property worth £40,000 or more.

The higher rates from 1 April 2025 are:

• Up to £125,000: 5%
• £125,001 to £250,000: 7%
• £250,001 to £925,000: 10%
• £925,001 to £1,500,000: 15%
• Above £1,500,000: 17%

For example, buying an additional property for £300,000 results in an SDLT bill of £20,000: 5% on the first £125,000 (£6,250), 7% on the next £125,000 (£8,750), and 10% on the remaining £50,000 (£5,000).

There are important exceptions. You will not pay the surcharge if you are replacing your main residence and your previous home has been sold within 36 months of completing the new purchase. If you have not yet sold your previous home at completion, you pay the higher rates upfront but can apply for a refund once it sells within 36 months. The surcharge was increased from 3% to 5% on 31 October 2024, and companies buying residential property worth £40,000 or more must also pay the higher rates.

Non-UK residents face an additional 2% surcharge on top of all applicable SDLT rates, including the higher rates for additional properties. This means a non-UK resident buying a second home could pay rates starting at 7% even on the first £125,000. For more details, see our guide on shared ownership.

SDLT only applies in England and Northern Ireland. If you are buying property in Scotland or Wales, different transaction taxes apply with their own rates and thresholds.

Scotland — Land and Buildings Transaction Tax (LBTT): Administered by Revenue Scotland, LBTT has a nil-rate band of £145,000 for standard purchases and £175,000 for first-time buyers. The rates above the threshold are 2% (£145,001–£250,000), 5% (£250,001–£325,000), 10% (£325,001–£750,000) and 12% above £750,000. Scotland’s Additional Dwelling Supplement (ADS) is 8% — significantly higher than the 5% SDLT surcharge in England.

Wales — Land Transaction Tax (LTT): Administered by the Welsh Revenue Authority, LTT has a nil-rate band of £225,000, the most generous in the UK. Rates are 6% (£225,001–£400,000), 7.5% (£400,001–£750,000), 10% (£750,001–£1,500,000) and 12% above £1,500,000. Wales does not currently offer a dedicated first-time buyer relief, though the high nil-rate threshold provides a similar effect. The higher rate for additional properties in Wales is 5% on top of standard rates.

The key takeaway is that the same property price can produce very different tax bills depending on where it is located. A £300,000 home costs £4,750 in SDLT in England, approximately £4,600 in LBTT in Scotland, and £4,500 in LTT in Wales.

Calculating SDLT is straightforward once you understand the slice system. Follow these steps:

Step 1: Determine which rate table applies. Are you a first-time buyer (purchasing at £500,000 or below)? Are you buying an additional property? Are you a non-UK resident? Each scenario has different rates.

Step 2: Split the purchase price into the rate bands. For a standard £400,000 purchase: the first £125,000 at 0%, the next £125,000 at 2%, and the remaining £150,000 at 5%.

Step 3: Calculate the tax on each slice.

• 0% × £125,000 = £0
• 2% × £125,000 = £2,500
• 5% × £150,000 = £7,500
• Total SDLT = £10,000

Step 4: Check for reliefs. If you qualify as a first-time buyer, the same £400,000 purchase would cost £5,000 in SDLT (0% on the first £300,000, 5% on the remaining £100,000) — saving £5,000.

HMRC provides an official SDLT calculator which handles all scenarios including leasehold purchases and mixed-use property. Your solicitor should also confirm the exact amount as part of the conveyancing process.

Remember that SDLT must be paid within 14 days of completion. For most transactions, your solicitor or conveyancer files the SDLT return and collects the tax as part of their completion fees. Late filing attracts automatic penalties: £100 if up to 3 months late, and £200 if more than 3 months late, plus interest on the unpaid tax.

This article is for informational purposes only and does not constitute regulated financial advice. Mortgage products and rates change frequently — always check the latest deals directly with lenders. For personalised advice on your mortgage options, consult a qualified mortgage adviser (check they're FCA-authorised at fca.org.uk/register).

For a deeper look at this area, read our guide to How to Calculate Fixed Asset Depreciation Using Excel.