Stamp duty, explained with real numbers
If you're buying a home or your first buy-to-let in England or Northern Ireland, stamp duty is probably the biggest single fee you'll pay, and the one most people get wrong when budgeting. This guide gives you the current bands, three fully worked examples, and the traps that catch people out. Rates below are current as of July 2026 and verified at gov.uk.
What stamp duty actually is
Stamp Duty Land Tax (SDLT) is a tax you pay when you buy property or land in England or Northern Ireland over a certain price. It's paid by the buyer, once, on completion. Scotland and Wales have their own versions with different names and different numbers. More on that below.
The key thing to understand: it works in slices, like income tax. You don't pay one rate on the whole price. You pay 0% on the first slice, then a higher rate on the next slice, and so on. A £300,000 house does not mean 5% of £300,000.
The standard bands (July 2026)
These apply if you're buying your only home and you've owned property before. The thresholds dropped back to these levels on 1 April 2025 and the Autumn 2025 Budget left them alone.
| Slice of the price | Rate |
|---|---|
| Up to £125,000 | 0% |
| £125,001 to £250,000 | 2% |
| £250,001 to £925,000 | 5% |
| £925,001 to £1.5 million | 10% |
| Above £1.5 million | 12% |
First-time buyer relief
If you (and anyone you're buying with) have never owned a property anywhere in the world, and you'll live in the place as your main home, you get better bands:
- £0 to £300,000: nothing.
- £300,001 to £500,000: 5% on that slice only.
- Over £500,000: relief vanishes entirely. Not tapered. Gone. A first-time buyer paying £500,001 pays full standard rates on the whole price. That £1 costs you £5,000 in tax: the bill jumps from £10,000 to £15,000.
"Anyone you're buying with" is the catch. If your partner owned a flat years ago and sold it, they're not a first-time buyer, and neither of you gets the relief on a joint purchase.
The additional-property surcharge
Buying a residential property for £40,000 or more when you'll end up owning more than one? You pay a 5% surcharge on top of every band. It went up from 3% to 5% in October 2024 and it's still 5% now.
| Slice of the price | Higher rate |
|---|---|
| Up to £125,000 | 5% |
| £125,001 to £250,000 | 7% |
| £250,001 to £925,000 | 10% |
| £925,001 to £1.5 million | 15% |
| Above £1.5 million | 17% |
Note there's no 0% band. The surcharge applies from the first pound.
Who it catches:
- Buy-to-let investors keeping their own home, obviously (see the first buy-to-let guide).
- Married couples and civil partners are treated as one unit. If either of you owns another property worth £40,000+, you both pay higher rates, even if the new place is in one name only.
- Home-movers who complete before selling. Buy your new main home before your old one sells and you pay the surcharge upfront. Sell the old home within three years and you can claim that part back from HMRC.
- Anyone with a share in property abroad. A half-share of a flat in Spain counts.
Non-UK residents: another 2%
If you haven't been in the UK for at least 183 days in the 12 months before purchase, add a 2% surcharge on top of whatever else applies. An overseas investor buying a second property pays standard rates plus 5% plus 2%.
Three worked examples
1. First-time buyer, £280,000 home
The whole price sits inside the £300,000 nil band.
- £0 to £280,000 at 0% = £0
Total SDLT: £0. Compare that with a non-first-time buyer on the same house: £2,500 + £1,500 = £4,000. The relief is worth having, so don't lose it by buying jointly with someone who's owned before.
2. Home-mover, £350,000 (selling old home, buying new one)
Standard bands, slice by slice:
- First £125,000 at 0% = £0
- £125,001 to £250,000 (£125,000) at 2% = £2,500
- £250,001 to £350,000 (£100,000) at 5% = £5,000
Total SDLT: £7,500. That's 2.1% of the price, not 5%. The slicing matters.
3. Investor buying a £120,000 second property
It's over £40,000 and they already own a home, so higher rates apply to the lot:
- First £120,000 at 5% = £6,000
Total SDLT: £6,000. On a standard purchase this house would cost £0 in stamp duty. The surcharge is the entire bill, so factor it into your deal maths before you offer, because it comes out of cash, not the mortgage.
When and how you pay
You must file an SDLT return and pay HMRC within 14 days of completion. In practice your solicitor or conveyancer does this on completion day and collects the money from you beforehand: it'll be a line on your completion statement (see the conveyancing guide). Miss the deadline and there are penalties plus interest. Either way, the money has to be sitting in cleared funds before completion: you can't normally add stamp duty to your mortgage, so treat it as cash you need on day one.
Scotland and Wales are different
Don't use the numbers above outside England and Northern Ireland.
Scotland charges Land and Buildings Transaction Tax (LBTT): 0% to £145,000, then 2%, 5%, 10% and 12% bands. First-time buyer relief exists but is modest: it lifts the nil band to £175,000, saving at most £600. The Additional Dwelling Supplement (Scotland's second-home surcharge) is a hefty 8% on the whole price for purchases of £40,000+. Both were confirmed unchanged in the Scottish Budget for 2026-27.
Wales charges Land Transaction Tax (LTT): 0% up to £225,000, then 6%, 7.5%, 10% and 12%. There is no first-time buyer relief in Wales at all: everyone gets the same bands. Higher rates for additional properties start at 5% and run to 17%, with no nil band.
Mistakes people make
- Budgeting the deposit but not the tax. Stamp duty is cash on top of your deposit (see the deposit guide), fees and survey. On example 2 above that's £7,500 you can't borrow.
- Assuming the headline rate applies to the whole price. It's slices. Do the band-by-band maths or use HMRC's calculator.
- Losing first-time buyer relief on a joint purchase. One previous owner on the deeds kills it for both of you.
- Forgetting a spouse's property counts. Buying the "second" property in the non-owning partner's name doesn't dodge the surcharge: married couples are assessed together.
- Nudging past £500,001 as a first-time buyer. Relief disappears completely, not gradually. Sometimes negotiating £1,000 off the price saves you £5,000 in tax.
- Not reclaiming the surcharge. Paid higher rates because your old home hadn't sold? You have three years to sell it and claim the surcharge portion back. People genuinely forget.
- Using English rates in Scotland or Wales. Different taxes, different bands, and in Scotland an 8% second-home supplement that changes deal maths completely.
Sources: gov.uk: SDLT residential property rates · gov.uk: Higher rates of SDLT · gov.uk: Stamp Duty Land Tax overview · revenue.scot: LBTT residential property · revenue.scot: Additional Dwelling Supplement · gov.wales: LTT rates and bands · gov.scot: Scottish Budget 2026-27, tax policy
Education, not financial advice. For mortgage advice, speak to an FCA-authorised broker.
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