Stamp Duty UK 2025 — Rates, Thresholds, First-Time Buyers and How to Pay
Stamp Duty Land Tax (SDLT) is one of the biggest costs involved in buying a home in England and Wales, yet many buyers are unclear about exactly what they owe — or whether they qualify for a discount. The temporary threshold increases introduced in 2022 ended on 31 March 2025, meaning rates reverted and thousands of buyers rushing to complete before the deadline faced a sudden increase in costs. This guide explains the current rates and everything you need to know before you buy.
What Is Stamp Duty Land Tax?
Stamp Duty Land Tax is a tax charged by the UK government on the purchase of land and property in England and Northern Ireland. Scotland has its own equivalent — Land and Buildings Transaction Tax (LBTT) — and Wales has Land Transaction Tax (LTT). This guide covers England only.
SDLT applies to residential and non-residential property. It is payable by the buyer, not the seller, and is calculated on the purchase price. SDLT is not payable on gifts of property (subject to anti-avoidance rules) or on inherited property, but it may be payable if you take on a mortgage as part of an inheritance.
SDLT is not a flat rate on the whole purchase price. Instead, it is charged in bands — similar to income tax — so you pay the relevant rate only on the portion of the price falling within each band. This is sometimes misunderstood: if you buy a property for £300,000, you do not pay 5% on the whole £300,000 — you pay 0% on the first £125,000, 2% on the next £125,000, and 5% on the remaining £50,000.
Current SDLT Rates from 1 April 2025
The temporary SDLT thresholds that had been in place since September 2022 ended on 31 March 2025. From 1 April 2025, the standard residential SDLT rates are:
| Purchase Price Band | Standard Rate |
|---|---|
| Up to £125,000 | 0% |
| £125,001 to £250,000 | 2% |
| £250,001 to £925,000 | 5% |
| £925,001 to £1,500,000 | 10% |
| Over £1,500,000 | 12% |
So for a property purchased at £350,000, the SDLT calculation is: £0 on the first £125,000 + £2,500 on the next £125,000 (2%) + £5,000 on the remaining £100,000 (5%) = £7,500 total. The same property during the temporary relief period (when the 0% band extended to £250,000) would have attracted only £5,000 — a saving of £2,500.
First-Time Buyer Relief
First-time buyers purchasing a property in England can claim a relief that raises the 0% threshold — but the rules changed significantly from 1 April 2025.
From 1 April 2025 (Current Rules)
From 1 April 2025, first-time buyers pay no SDLT on the first £300,000 of a purchase price up to £500,000. On the portion between £300,001 and £500,000 they pay 5%. If the purchase price exceeds £500,000, no first-time buyer relief is available and standard rates apply in full.
| Purchase Price Band (First-Time Buyers) | Rate from 1 April 2025 |
|---|---|
| Up to £300,000 | 0% |
| £300,001 to £500,000 | 5% |
| Over £500,000 | Standard rates apply — no relief |
Note: Between 23 September 2022 and 31 March 2025, first-time buyers had even more generous relief — 0% up to £425,000 and 5% up to £625,000. This temporary relief ended with the March 2025 deadline.
Who Counts as a First-Time Buyer?
You qualify as a first-time buyer if you have never previously owned a residential property anywhere in the world — either freehold or a leasehold of more than 21 years. If you are buying jointly, all buyers must be first-time buyers for the relief to apply. If one of you has owned property before, neither of you can claim the relief.
The Second Home Surcharge
If you are buying an additional residential property — a buy-to-let, a second home, or a holiday home — you pay a surcharge of 3 percentage points on top of the standard SDLT rates. This applies to any purchase where you already own a residential property at the end of the day of completion, whether in the UK or abroad.
| Purchase Price Band | Second Home / Additional Dwelling Rate |
|---|---|
| Up to £125,000 | 3% |
| £125,001 to £250,000 | 5% |
| £250,001 to £925,000 | 8% |
| £925,001 to £1,500,000 | 13% |
| Over £1,500,000 | 15% |
The surcharge also applies from 31 October 2024 at the higher rate of 5 percentage points (increased from 3%) for purchases of additional dwellings. If you completed before 31 October 2024, the old 3% surcharge applies.
Replacing Your Main Residence
If you are buying a new main residence and have not yet sold your previous main residence, you will need to pay the higher rates at completion — but you can claim a refund within 12 months of selling your previous home, provided the sale takes place within 36 months of buying the new property. HMRC operates an online refund process for this.
SDLT on Leasehold Properties
Leasehold purchases are more complex than freehold. You pay SDLT on the premium (the purchase price) in the same way as a freehold. However, if the lease is a new lease rather than an assignment of an existing lease, you may also pay SDLT on the "net present value" (NPV) of the rental payments over the life of the lease. For most residential leasehold purchases, the NPV element is zero because there is no ground rent. But for high-ground-rent leases — increasingly rare after the Leasehold Reform (Ground Rent) Act 2022 banned ground rents for new residential leases — this could add to your SDLT bill.
Non-Resident Surcharge
From 1 April 2021, non-UK residents purchasing residential property in England pay an additional 2% surcharge on top of standard rates (including any second home surcharge). You are a non-UK resident for SDLT purposes if you have not spent at least 183 days in the UK in the 12 months before the purchase. The surcharge applies per property — it is not possible to structure a purchase to avoid it.
SDLT Exemptions and Reliefs
Several situations attract reduced or zero SDLT:
- Transfers on divorce or civil partnership dissolution — no SDLT on property transferred between spouses or civil partners under a court order following relationship breakdown
- Gifts — no SDLT if no money or other consideration is given (but if a mortgage is taken over, SDLT is payable on the mortgage value)
- Inherited property — no SDLT on property received by inheritance
- Purchases under £40,000 — exempt (though properties worth this little are rare)
- Multiple dwellings relief — if buying two or more dwellings in a single transaction, you can apply to pay SDLT at the rate applicable to the average purchase price, potentially significantly reducing the bill. This relief is commonly used for bulk buy-to-let purchases.
- Mixed-use property — if the property includes a non-residential element (such as a shop with a flat above), different non-residential rates may apply, which can produce a lower overall SDLT bill
How and When to Pay SDLT
SDLT must be paid, and the return filed with HMRC, within 14 days of the effective date of the transaction (usually the date of completion). In practice, your conveyancing solicitor handles this on your behalf as part of the conveyancing process — they collect the SDLT as part of the completion funds and submit the return electronically.
If you complete without a solicitor (which is unusual but legally possible), you must file the return and pay the tax yourself using HMRC's online SDLT return service. Penalties apply for late filing and late payment — £100 for filing up to three months late, rising to £200 or 5% of the tax due for longer delays.
Can You Reclaim SDLT?
In certain circumstances, you can claim a refund of SDLT already paid:
- You paid the higher rates because you had not yet sold your previous main residence, and you sell it within 36 months of buying the new property — claim within 12 months of the sale
- The transaction is rescinded (cancelled) after completion
- You overpaid because your solicitor made an error in the return
- You claimed multiple dwellings relief incorrectly and the average price calculation should have produced a lower figure
HMRC has a four-year time limit for making overpayment refund claims from the date of the original return. Beyond that, refunds are not available.
Step-by-Step: SDLT When Buying a Property
- Calculate your SDLT liability before making an offer — use our calculator to understand the full cost and factor it into your budget alongside legal fees, survey costs, and mortgage arrangement fees.
- Tell your solicitor about all properties you own — your conveyancer needs to know your full property ownership position to apply the correct rates. If you own property abroad, that counts too.
- Check eligibility for reliefs — first-time buyer relief, multiple dwellings relief, or mixed-use property relief could reduce your bill significantly. Ask your solicitor whether any apply.
- Ensure funds are available at completion — SDLT is due 14 days after completion. Your solicitor will include it in the completion statement, and it must be paid from your completion funds.
- Keep records — your solicitor will give you a copy of the SDLT return and the payment receipt. Keep these with your title documents as evidence that tax was paid.