Stamp Duty Land Tax (SDLT) is the tax most buyers of residential property in England and Northern Ireland pay when they complete a purchase. The rules have changed several times in recent years, with the most recent shift on 1 April 2025 reverting many thresholds to their pre-2022 levels. This guide walks through how the tax is calculated today, who pays what, and the most common reliefs and exemptions.

What is Stamp Duty Land Tax?

SDLT is a tax on land transactions in England and Northern Ireland. It applies to most purchases of freehold property, the assignment or grant of a lease, and certain other transfers of an interest in land. Scotland has its own equivalent — Land and Buildings Transaction Tax (LBTT) — and Wales has Land Transaction Tax (LTT). This guide deals only with SDLT.

The tax is charged in bands. You don't pay one flat rate on the whole price; instead, the rate that applies to each portion of the price stacks up to give the total. That means a small change in price near a threshold doesn't push every pound into a higher rate — only the pounds above the threshold.

Who pays SDLT and when

The buyer pays SDLT, not the seller. It is due within 14 days of the "effective date" of the transaction, which in most residential conveyances is the day of completion. Your solicitor or licensed conveyancer will normally file the SDLT return and pay the tax to HMRC on your behalf, then bill you for it as part of your completion statement.

Even if no tax is due — for example, on a first-time-buyer purchase below £300,000 — an SDLT return must still be filed unless the transaction is specifically exempt (such as a transfer between spouses on no consideration, or a property left in a will).

Current SDLT rates (1 April 2025 onwards)

The standard residential rates are charged on the portion of the price falling in each band:

Portion of price	Rate
Up to £125,000	0%
£125,001 – £250,000	2%
£250,001 – £925,000	5%
£925,001 – £1,500,000	10%
Over £1,500,000	12%

To take a worked example, on a £600,000 home for a buyer replacing their main residence: the first £125,000 is tax-free; the next £125,000 is taxed at 2% (£2,500); and the remaining £350,000 is taxed at 5% (£17,500). Total SDLT: £20,000.

First-time buyer relief

First-time buyer relief is one of the most valuable tax breaks in the property market, but it has tight eligibility rules. To qualify, every buyer named on the purchase must be a first-time buyer of a residential property anywhere in the world — including inherited property and property owned with a former partner. You must also intend to live in the property as your only or main residence.

Under the rules in force from 1 April 2025, the relief gives you:

• 0% on the first £300,000 of the price
• 5% on the portion between £300,001 and £500,000
• No relief at all if the price is more than £500,000 — standard rates apply to the whole purchase

The £500,000 cliff edge can sting. A £499,000 first-time-buyer purchase attracts £9,950 of SDLT. A £501,000 purchase attracts £15,050 — a jump of more than £5,000 because the relief disappears entirely. If you are negotiating around that level, the difference between just under and just over the cap can be material.

The additional-property surcharge

If you already own a residential property and you are buying another one that won't replace your main residence, an extra 5% surcharge applies on top of the standard rates. This catches buy-to-let investors, second home buyers, and anyone buying a new home before they have managed to sell their current one.

The surcharge was raised from 3% to 5% on 31 October 2024, so an additional purchase that completed before that date used the lower rate. The bands look like this:

Portion of price	Rate (additional property)
Up to £125,000	5%
£125,001 – £250,000	7%
£250,001 – £925,000	10%
£925,001 – £1,500,000	15%
Over £1,500,000	17%

Two important points. First, the surcharge does not apply if the price is below £40,000. Second, if you complete on a new home before selling your old one, you initially pay the surcharge but you can claim a refund within 12 months of the sale of the old property if the sale happens within three years of the new purchase.

The non-UK resident surcharge

A 2% non-resident surcharge has applied since 1 April 2021 to non-UK resident buyers of residential property in England and Northern Ireland. It stacks on top of every other rate. So a non-resident buying an additional property pays standard + 5% + 2% on each band.

For SDLT purposes, you are a non-UK resident if you are not present in the UK for at least 183 days in the 12 months ending on the day of completion. There is a refund route: if you become UK resident in any continuous 365-day period falling within the two years either side of completion, you can usually reclaim the surcharge.

Reliefs and exemptions you might qualify for

Beyond first-time-buyer relief, the most commonly used reliefs and exemptions include:

• Multiple dwellings relief (MDR). Removed for transactions completing on or after 1 June 2024, so this no longer applies to current purchases — but you may still see it referenced in older paperwork.
• Replacement of main residence. If you complete on your new main home before selling your old one, you initially pay the additional-property surcharge. Sell the old home within three years and you can reclaim the surcharge.
• Transfers on divorce or separation. Property transferred between spouses or civil partners as part of a court- approved settlement is generally exempt.
• Inherited property. Property left to you in a will is not an SDLT event for you. However, owning an inherited property can affect your status for first-time-buyer relief or the additional-property surcharge on a future purchase.
• Mixed-use purchases. A property that is part residential and part commercial (e.g., a shop with a flat above) is usually charged at non-residential rates, which are lower at the top end. This area is heavily contested by HMRC and worth taking advice on.

The £40,000 threshold for additional properties

A point that catches people out: if you are buying an additional residential property for less than £40,000, the higher rates simply do not apply. Standard rates do (which on a £35,000 property come to £0 anyway). Above £40,000 the surcharge applies to the whole price.

How SDLT is paid

In nearly every residential transaction the buyer's solicitor handles SDLT. They prepare an SDLT return with HMRC, pay the tax on or before the 14-day deadline, and add the figure to your completion statement. You normally provide the funds with your other completion monies.

If you complete the return yourself, HMRC accepts payment by online bank transfer (Faster Payments, CHAPS or Bacs), debit card, or by cheque. Late filing or late payment attracts penalties and interest, so most buyers leave it to their conveyancer.

How to claim a refund

Two refund situations come up frequently:

• Sold your old main home within three years. If you paid the 5% additional-property surcharge because you hadn't yet sold your previous main residence, you can apply to reclaim it once you do sell. The deadline is the later of 12 months from the sale or 12 months from the SDLT filing date.
• Became UK resident after a non-resident purchase. If you were non-resident at the time of completion but you spend at least 183 days in the UK in any continuous 365-day period falling in the two years either side of completion, you can reclaim the 2% surcharge.

Refunds are claimed by amending the original SDLT return. You can do this online through HMRC, or your solicitor can do it for you.

A short history of recent SDLT changes

SDLT has been a moving target. The headline changes in the past few years:

• 23 September 2022. The standard nil-rate band was increased to £250,000 and the first-time-buyer threshold to £425,000 with relief available up to £625,000. This was framed as a temporary increase.
• 31 October 2024. The additional-property surcharge was raised from 3% to 5%. The single rate of SDLT charged on residential purchases by companies and other non-natural persons worth more than £500,000 was raised from 15% to 17%.
• 1 April 2025. The temporary thresholds expired. The standard nil-rate band reverted to £125,000 and the first-time-buyer threshold reverted to £300,000 with the relief cap returning to £500,000.

Worked examples

£250,000 first-time buyer

The first £300,000 of an FTB purchase is tax-free, and £250,000 sits entirely below that threshold. SDLT: £0.

£425,000 first-time buyer

The first £300,000 is tax-free; £125,000 is taxed at 5% (£6,250). Total: £6,250. Effective rate 1.47%.

£550,000 first-time buyer (over the cap)

Above £500,000 first-time-buyer relief is lost. Standard rates apply: £125,000 at 0%, £125,000 at 2% (£2,500), and £300,000 at 5% (£15,000). Total: £17,500.

£400,000 buy-to-let (additional property)

£125,000 at 5% (£6,250); £125,000 at 7% (£8,750); £150,000 at 10% (£15,000). Total: £30,000.

£800,000 second home for a non-UK resident

Add 5% (additional) + 2% (non-resident) to every standard band: £125,000 at 7%; £125,000 at 9%; £550,000 at 12%. Total: £86,750.