What is Stamp Duty Land Tax?
Quick answer: Stamp Duty is a tax you may have to pay when you buy property in England or Northern Ireland. You usually pay 0% Stamp Duty on the first £125,000, or the first £300,000 if you’re a first-time buyer. Stamp Duty rates are higher if your property costs more.
If you’re buying a home in the UK, Stamp Duty Land Tax (SDLT) can be one of the key costs you need to plan for. The amount you pay depends on the property price and your situation, like whether you’re a first-time buyer or buying a second home.
This guide explains how Stamp Duty works across the UK, including similar taxes in Scotland and Wales. You’ll learn about the different rates, how to calculate Stamp Duty and how to pay it on time.
What is Stamp Duty in the UK?
Stamp Duty is a tax you may have to pay when you buy a property in England or Northern Ireland.
It applies to most properties, including:
- Residential properties, meaning homes people live in
- Non-residential and mixed-use properties, like farms and warehouses
- Both freehold and leasehold properties, including houses and flats
- Properties bought outright or with a mortgage
- Second homes and buy-to-let properties
What is Land and Building Transaction Tax?
Land and Building Transaction Tax (LBTT) is a tax you may pay when you buy a property in Scotland. It’s charged on properties costing over £145,000, or over £40,000 if it’s your second home.
Land and Building Transaction Tax is like Stamp Duty, but it’s set by the Scottish Government and uses different rates.
LBTT for first-time buyers is often cheaper, as you’ll only pay tax after the first £175,000 instead of the first £145,000.
What is Land Transaction Tax?
Land Transaction Tax (LTT) is a tax on property purchases in Wales that cost over £225,000, or over £40,000 if it’s your second home.
Land Transaction Tax is similar to Stamp Duty and LBTT, but it’s set by the Welsh Government and uses different rates.
Unlike Stamp Duty, there are no special LTT rates for first-time buyers in Wales.
How much is Stamp Duty?
If you’re buying your main home and it doesn’t cost more than the Stamp Duty threshold of £125,000, you usually won’t pay any Stamp Duty Land Tax.
If your property costs more than the Stamp Duty threshold, you’ll be taxed at different percentages, known as rates, for certain parts of the property price.
The table below shows Stamp Duty rates for buying your main home. They’re different if you’re a first-time buyer, a non-UK resident or you’ll own more than one property.
| Property price band | Stamp Duty rate (main home) |
|---|---|
| The first £125,000 | 0% |
| From £125,001 to £250,000 | 2% |
| From £250,001 to £925,000 | 5% |
| From £925,001 to £1.5 million | 10% |
| Over £1.5 million | 12% |
Here’s how Stamp Duty rates would be charged on property costing £500,000:
- 0% on the first £125,000 = £0
- 2% on the next £125,000 = £2,500
- 5% on the remaining £250,000 = £12,500
- Total Stamp Duty = £15,000
How much is Stamp Duty for first-time buyers?
First-time buyer Stamp Duty is often cheaper. If you’ve never owned property before, you can get a discount, also known as relief, on Stamp Duty for a home costing up to £500,000. If the property price is over £500,000, relief won’t apply to any of it. You’ll need to pay the usual rates for a single home.
| Property price band | Stamp Duty rate (first-time buyers) |
|---|---|
| The first £300,000 | 0% |
| From £300,001 to £500,000 | 5% |
As an example, if you buy a £500,000 home, you’d pay £15,000 in Stamp Duty at the standard rates, but £10,000 as a first-time buyer — meaning you save £5,000.
If you buy a home with someone else, you only get Stamp Duty relief if you’re both first-time buyers.
If you’ve ever inherited a property, or part of one, you won’t count as a first-time buyer for Stamp Duty.
How much is Stamp Duty on a second home?
Stamp Duty rates are higher if you’ll own more than one property. You usually pay an extra 5% on top of the standard Stamp Duty rates.
You don’t have to pay second-home Stamp Duty rates if the new property will be your main home and you sell your old home within 36 months. If it takes longer to sell, you may be able to get a Stamp Duty refund.
Here are the Stamp Duty rates on a second home, as of 1 April 2025.
| Property price band | Stamp Duty rates (second home) |
|---|---|
| The first £125,000 | 5% |
| From £125,001 to £250,000 | 7% |
| From £250,001 to £925,000 | 10% |
| From £925,001 to £1.5 million | 15% |
| Over £1.5 million | 17% |
How much is Stamp Duty for non-residents?
If you’re not a UK resident, you may have to pay an extra 2% on top of the standard Stamp Duty rates if you buy a UK property costing more than £40,000.
You’re usually a non-UK resident for Stamp Duty if you’ve spent less than 183 days in the UK in the 12 months before you buy.
How much Stamp Duty will I pay?
Stamp Duty is charged at different rates on certain parts of the property price. Here are three examples of what the actual cost of Stamp Duty can look like.
| Property price (UK and Northern Ireland) | Single home Stamp Duty | First-time buyer Stamp Duty | Second home Stamp Duty |
|---|---|---|---|
| £150,000 | £500 | £0 | £8,000 |
| £250,000 | £2,500 | £0 | £15,000 |
| £500,000 | £15,000 | £10,000 | £40,000 |
If you want to work out how much Stamp Duty to pay on a particular property, the UK government has a Stamp Duty calculator.
Stamp Duty can be a large amount to save for. One option is to borrow more on your mortgage to help cover the cost. You’ll pay more interest and may have higher monthly payments. See how much you could borrow and try to improve your credit score to boost your chances of acceptance.
Your credit score reflects how most lenders see you. Check your free Experian Credit Score without affecting it.
How much Land and Building Transaction Tax will I pay?
If the property is in Scotland, you’ll pay Land and Building Transaction Tax (LBTT) instead of Stamp Duty. Here are three examples of what the actual cost of LBTT might look like.
| Property price (Scotland) | Single home LBTT | First-time buyer LBTT | Second home LBTT |
|---|---|---|---|
| £150,000 | £100 | £0 | £12,100 |
| £250,000 | £2,100 | £1,500 | £22,100 |
| £500,000 | £23,350 | £22,750 | £63,350 |
If you want to work out LBTT for a particular property, Revenue Scotland has a LBTT calculator.
How much Land Transaction Tax will I pay?
If the property is in Wales, you’ll pay Land Transaction Tax (LTT) instead of Stamp Duty. Here are three examples of what the actual cost of LTT might look like.
| Property price (Wales) | Single home LTT | First-time buyer LTT | Second home LTT |
|---|---|---|---|
| £150,000 | £0 | £0 | £7,500 |
| £250,000 | £1,500 | £1,500 | £14,950 |
| £500,000 | £18,000 | £18,000 | £42,450 |
If you want to work out LTT for a particular property, the Welsh government has a LTT calculator.
How to pay Stamp Duty
There are multiple ways to pay Stamp Duty to HMRC:
- Approving a payment through your online banking
- Paying online with a debit card or corporate credit card
- Making a bank transfer to HMRC
- Sending a cheque in the post
To pay Stamp Duty, you first need to file a Stamp Duty return. You’ll get an 11-character unique transaction reference number, which you should provide when paying. Make sure to use the official GOV.UK website.
Your solicitor can file your Stamp Duty return for you, but it’s up to you to make sure it’s submitted on time. You should file even if you don’t need to pay any Stamp Duty.
When do you pay Stamp Duty?
You have 14 days from the effective transaction date, which is usually the day your purchase completes, to file and pay Stamp Duty. If you pay late, you could be charged penalties and interest.
How to prepare for Stamp Duty
It’s important to budget for Stamp Duty, as well as the other costs of buying a home, like legal fees and your mortgage deposit. A Stamp Duty calculator can help you estimate the amount you’ll pay.
Think about how you’ll afford the taxes and if you can lower the cost. Some things to consider are:
- The property price — Buying a cheaper home or negotiating a lower price will also bring down the cost of Stamp Duty. If you’re a first-time buyer, stay under £500,000 to get a Stamp Duty discount or under £300,000 to pay none at all.
- Who you’re buying with — If you’re a first-time buyer, you won’t get Stamp Duty relief if you buy with someone who’s owned property before. If you’re buying with someone who’s keeping their other home, you may have to pay extra.
- Your mortgage amount — You may be able to get a larger mortgage to help you cover the cost of Stamp Duty. You’ll pay more interest and may have higher monthly payments and an increased loan-to-value ratio. You usually need a good credit score for a larger mortgage.
Getting ready to buy a home? It’s worth checking your credit score and report about three to six months before applying for a mortgage. This helps you understand how lenders view you and gives you time to improve your score. Get your free score and report with Experian.
Remember to compare mortgages to make sure you’re getting the best deal. Fill in a few details and we’ll connect you to our trusted partner, Picnic, for expert advice and top offers from over 100 lenders.
How to make sure you pay the right amount
The amount of Stamp Duty you pay can depend on small details, such as whether you’re a first-time buyer, replacing your main home, buying with someone else, buying a second home, or classed as a non-resident.
Check the latest rules before you buy and make sure your solicitor has the right information about your situation. If you’re not sure, ask them to explain how they’ve worked out your Stamp Duty amount before you file your return.
Frequently asked questions
How much is Stamp Duty on buy-to-let?
If you already own property and you’re buying another to rent out, it’ll usually be treated as a second home for Stamp Duty. This means paying an extra 5% on top of the usual Stamp Duty rates. So, you’ll pay:
- 5% on the first £125,000 of the property price
- 7% on the portion between £125,001 and £250,000
- 10% on the portion between £250,001 and £925,000
- 15% on the portion between £925,001 and £1.5 million
- 17% on anything over £1.5 million
For example, you’d pay £15,000 in Stamp Duty on a £250,000 buy-to-let property.
Do you pay Stamp Duty when selling a property?
No, you don’t pay Stamp Duty when selling a property. Stamp Duty is paid by the buyer, not the seller. But as the seller you may have to pay Capital Gains Tax.
How much is Stamp Duty with shared ownership?
You can choose to pay Stamp Duty on a shared ownership property in one of two ways:
- Pay upfront on the full property value — This can mean a larger upfront cost, but you won’t pay more later if you buy extra shares of your home.
- Pay in stages on your share — You pay Stamp Duty based on the share you buy now, then more later if you increase your share above 80%.
You must have bought the property through an official shared ownership scheme.
Remember, there’s no Stamp Duty to pay if the property value is below the Stamp Duty threshold of £125,000 — or £300,000 if you’re a first-time buyer.
What happens if I don’t pay Stamp Duty?
If you don’t pay Stamp Duty on time, HMRC will charge:
- A fixed penalty fee of £100 to £200
- A tax-based fee if you’re over 12 months late, which can be as much as your Stamp Duty amount
- Interest on the amount you owe, starting the day after you should have paid it
How much is Stamp Duty on a main residence if you own another property?
If you’re buying a property to replace your main home, you’ll usually pay standard Stamp Duty rates as long as you sell your old home within 36 months. If you don’t sell your old home, or the new property isn’t your main home, you’ll pay an extra 5% on top of the usual rates.
How much is Stamp Duty on an inherited property?
If someone gives you property in their will when they die, there’s usually no Stamp Duty to pay, even if you take on their mortgage. But you might have to pay Inheritance Tax.
How much is Stamp Duty on a self-build?
You usually only pay Stamp Duty on the land you buy, not on the construction costs or the final value of the home you build.