Stamp Duty Land Tax explained (2025/26)
Stamp Duty Land Tax (SDLT) is usually the largest single tax in a home purchase. This guide explains exactly how it's calculated in England and Northern Ireland, who pays more, where the reliefs are, and the traps that catch buyers out, all on the rates in force from 1 April 2025.
How SDLT is calculated, the "slice" system
SDLT is a progressive, sliced tax: you pay each rate only on the portion of the price that falls inside that band, not a single rate on the whole price. So on a £350,000 home a standard buyer pays 0% on the first £125,000, 2% on the slice to £250,000 (£2,500), and 5% on the remaining £100,000 (£5,000), £7,500 in total, an effective rate of about 2.1%. The calculator above shows this band split live.
England & NI only
Standard residential bands
| Portion of price | Standard rate | Additional property |
|---|---|---|
| Up to £125,000 | 0% | 5% |
| £125,001 to £250,000 | 2% | 7% |
| £250,001 to £925,000 | 5% | 10% |
| £925,001 to £1.5m | 10% | 15% |
| Above £1.5m | 12% | 17% |
The nil-rate threshold dropped from £250,000 to £125,000 on 1 April 2025, when the temporary higher threshold ended. That means most buyers now pay a little more than in 2024.
First-time buyer relief
First-time buyers pay 0% up to £300,000 and 5% on the portion from £300,001 to £500,000. Above a £500,000 purchase price the relief disappears entirely and standard rates apply to the whole amount, a genuine cliff-edge. To qualify, every buyer must never have owned a residential property anywhere in the world, and must intend to live in the property as their only or main home.
The £500,000 cliff-edge
The additional-property surcharge
If you'll own more than one residential property at the end of the day of completion, a 5% surcharge applies on top of the standard rate for every band (raised from 3% on 31 October 2024). This hits buy-to-let investors and second-home buyers. The key exception is replacing your main residence: if you sell your previous main home on or before the purchase, the surcharge doesn't apply. Sell it later (within 36 months) and you can reclaim the surcharge you paid.
Non-resident surcharge
Buyers who are not UK-resident for SDLT purposes pay an extra 2% on every band. The residence test is specific to SDLT (broadly, present in the UK for at least 183 days in the 12 months around the purchase), so it can differ from your income-tax residence. If you later become UK-resident, you may be able to reclaim the 2%.
£600,000 home, three buyer types
| Buyer | SDLT | Effective rate |
|---|---|---|
| Home mover | £17,500 | 2.9% |
| First-time buyer | £17,500 | 2.9% |
| Additional / BTL | £47,500 | 7.9% |
At £600,000 the first-time buyer gets no relief (above the £500,000 ceiling), so pays the same as a home mover. The additional-property surcharge adds a flat 5% of the price, £30,000, on top.
When and how to pay
An SDLT return must be filed and the tax paid within 14 days of completion. In practice your conveyancer files it and collects the money from you at completion, so you rarely deal with HMRC directly, but you remain legally responsible for it being correct and on time. Keep evidence of first-time buyer status or main-residence replacement in case of a later enquiry.
Mixed-use, multiple dwellings and leases
Properties with both residential and commercial elements may be taxed at the lower non-residential rates. Multiple Dwellings Relief was abolished for most purchases from 1 June 2024. New leasehold purchases can attract SDLT on the rent (the "net present value") as well as the premium. These are specialist areas, take advice before relying on a cheaper treatment, as HMRC scrutinises aggressive claims closely.
Common mistakes
- Assuming the old £250k threshold. The nil-rate band fell to £125,000 in April 2025. Older calculators understate the bill.
- Forgetting the surcharge timing. Owning any other home at completion triggers the 5% surcharge, even briefly. Time your sale and purchase carefully.
- Over-claiming first-time status. Previous ownership anywhere in the world (including inherited shares) disqualifies you.
- Budgeting only for the rate, not the cash. SDLT is payable in cash within 14 days and usually cannot be added to the mortgage. Plan for it upfront.
- Ignoring reclaim windows. Sold your old home after buying? You may reclaim the surcharge within 12 months of the sale (up to 36 months to sell).