Everything you need to know about Stamp Duty Land Tax before you buy — rates, reliefs, and the cliff edges that catch buyers out.
Stamp Duty Land Tax (SDLT) is one of the largest single costs in buying a home in England or Northern Ireland, yet it's also one of the most misunderstood — many buyers either overestimate it because they don't realise it's progressive, or get caught out by a cliff-edge rule they didn't know existed. Here's the complete picture.
SDLT is paid by the buyer (not the seller) on most property and land purchases in England and Northern Ireland above the relevant threshold. It must be paid within 14 days of completion — in practice, your solicitor or conveyancer handles the filing and payment as part of the standard completion process, so you don't need to do this yourself, but you do need to budget for it.
| Portion of price | Rate |
|---|---|
| Up to £250,000 | 0% |
| £250,001 – £925,000 | 5% |
| £925,001 – £1,500,000 | 10% |
| Over £1,500,000 | 12% |
Like Income Tax, SDLT is progressive — you only pay each rate on the slice of the price that falls in that band, not the whole purchase price at the top rate that applies to it.
If you've never owned a property anywhere in the world before, you qualify for first-time buyer relief: 0% on the first £425,000, then 5% on the portion from £425,001 to £625,000. This is genuinely generous — a first-time buyer purchasing at £425,000 pays no SDLT at all.
But there's a hard cliff edge that catches people out: if the property costs even £1 over £625,000, the relief disappears entirely. You don't get a reduced version of the relief — you pay standard rates on the full purchase price as if you weren't a first-time buyer at all. If you're buying close to this threshold, it's worth knowing that crossing it by even a small amount can cost you thousands more in SDLT than staying just under it.
If you already own a residential property anywhere in the world and you're buying another one — a second home, a buy-to-let, or simply because your purchase completes before your sale of an existing home — a surcharge of 5 percentage points is added to every band of the standard rates, including the portion that would otherwise be tax-free. This means even a modest additional property purchase generates SDLT from the very first pound, since there's no 0% band once the surcharge applies.
If you're selling your main home and buying a new one but the timing means you technically own two properties briefly, you can normally claim a refund of the surcharge if you sell your previous main residence within 36 months.
£300,000, standard mover: 0% on the first £250,000, then 5% on the remaining £50,000 = £2,500 total.
£500,000, first-time buyer: 0% on the first £425,000, then 5% on the remaining £75,000 = £3,750 total.
£650,000, first-time buyer (over the relief limit): No relief applies at all because the price exceeds £625,000. Standard rates apply to the full price: 0% on £250,000, 5% on the next £400,000 = £20,000 total — a dramatic jump compared to a buyer at £624,999.
£300,000, additional property: Standard SDLT of £2,500 plus a flat 5% surcharge on the whole £300,000 (£15,000) = £17,500 total.
If you're buying in Scotland, you pay Land and Buildings Transaction Tax (LBTT) instead of SDLT, with its own bands and rates. In Wales, you pay Land Transaction Tax (LTT). Both have broadly similar progressive structures to SDLT but different thresholds, rates, and reliefs — don't assume the England/NI figures above apply if you're buying elsewhere in the UK.
Sources: gov.uk Stamp Duty Land Tax guidance. This article is for informational purposes only and does not constitute financial or legal advice. Always confirm exact figures with your solicitor or conveyancer.