Stamp Duty and Land Taxes

Overview

Stamp Duty Land Tax (SDLT) is paid when you buy property or land in England and Northern Ireland above a certain value. The amount depends on the purchase price, the type of property, and whether you are a first-time buyer or already own other property. This guide explains what SDLT is, how it works, who pays and how to work out what you owe, so you can budget for a home or investment purchase.

What Is Stamp Duty Land Tax?

SDLT is charged on purchases of property or land in England and Northern Ireland once the price passes a threshold. It covers freehold and leasehold purchases, whether you pay cash or use a mortgage. The amount you pay depends on: the price of the property or land; whether it is residential or non-residential; whether you are a first-time buyer (you may get a discount); whether you already own another property (an extra surcharge may apply). Understanding SDLT helps you budget for the full cost of buying and avoid surprises at completion.

Getting Started

Before buying, find out when SDLT applies and roughly how much you might owe. It is calculated on the slice of the price that falls within each rate band, not on the whole price at one rate. First-time buyers may get relief on residential property up to a certain value, paying less or nothing on part of the price. If you are buying an additional property, such as a second home or buy-to-let, you will usually pay higher rates because of a surcharge. Knowing the rules and thresholds, and how to report and pay, helps you plan and stay compliant.

Stamp Duty on Shares

Buying shares usually attracts a 0.5% charge. Shares bought electronically are subject to Stamp Duty Reserve Tax (SDRT). Shares bought with a stock transfer form incur Stamp Duty if the transaction exceeds £1,000.

SDLT: England and Northern Ireland

SDLT applies to land and property transactions in England and Northern Ireland. Scotland uses Land and Buildings Transaction Tax (LBTT) and Wales uses Land Transaction Tax (LTT). Rates apply only to the portion of the price within each band.

Residential property

These rates may rise by 5% where further residential properties costing over £40,000 are acquired.

First-time buyer relief

Relief is available to first-time buyers on residential purchases up to £500,000, with rates applying to the portion in each band.

Non-residential property

LBTT: Scotland

Land and Buildings Transaction Tax applies to land and property transactions in Scotland. Rates apply to the portion of the price in each band.

Residential property

Non-residential property

LTT: Wales

Land Transaction Tax applies to land and property transactions in Wales. Rates apply to the portion of the price in each band.

Residential property

Residential rates may be higher where further residential properties costing £40,000 or more are acquired.

Higher residential rates

Higher rates may apply when you already own one or more residential properties.

Non-residential property

Who Pays Stamp Duty Land Tax?

Anyone buying property or land in England or Northern Ireland pays SDLT if the price is above the threshold. This includes:

Homebuyers

Buyers of a first home or main residence may owe SDLT depending on price and whether first-time buyer relief applies

Second home and buy-to-let buyers

Buyers of additional residential properties, such as second homes and buy-to-let properties, usually pay the higher SDLT rates, which are currently 5 percentage points above the standard rates.

Businesses and investors

Companies and investors buying residential or non-residential property also pay. Higher rates and extra charges may apply if a company owns multiple properties or values exceed certain thresholds.

Leaseholders

SDLT may be due on a new lease or a lease extension if the premium or lease value is over the threshold. Knowing who pays and when helps buyers budget and avoid unexpected costs at completion.

How to Pay SDLT

Once you buy property or land that is liable, you must file an SDLT return and pay any tax due within 14 days of completion.

How it works

Your solicitor or conveyancer normally calculates the tax, files the return with HMRC and arranges payment, but you remain legally responsible for it being paid on time.

How it is calculated

Different rates apply to the parts of the price in each band. First-time buyers and buyers of additional property may face different rates or surcharges.