Stamp Duty – everything you need to know
If you’re thinking about buying a property, you’ll probably have heard of Stamp Duty but might have questions. What is Stamp Duty? How much will Stamp Duty cost you? When do you have to pay Stamp Duty? This helpful guide will tell you everything you need to know.
In this guide
What is Stamp Duty UK?
Stamp Duty is a tax you’re required to pay to the government when you buy a property or land in England or Northern Ireland. Scotland and Wales have similar taxes called Land and Buildings Transaction Tax (LBTT) and Land Transaction Tax (LTT).
How much is Stamp Duty?
Stamp Duty (SDLT), Land and Buildings Transaction Tax (LBTT) and Land Transaction Tax (LTT) all have different rates and thresholds, so there isn’t one UK land tax rate.
How much is Stamp Duty in England and Northern Ireland?
Stamp Duty is calculated using different bands.
The current bands in England and Northern Ireland are shown in the table below.
| Property price | Stamp Duty Land Tax (SDLT) rate |
| Up to £250,000 | 0% |
| £250,001 – £925,000 | 5% |
| £925,001 – £1.5 million | 10% |
| Over £1.5 million | 12% |
If you buy a property that costs £300,000, you will not be required to pay any Stamp Duty on the first £250,000 (the current Stamp Duty threshold). You will only be required to pay 5% Stamp Duty on £50,000 (the cost of the property minus the £250,000 below the threshold).
If you were buying a property that costs £1 million, the Stamp Duty would be calculated as follows:
First £250,000 = no Stamp Duty payable
Next £675,000 (portion from £250,001 to £925,000) charged at 5% = £33,750
Next £75,000 (£1 million – £925,000) charged at 10% = £7,500
Total Stamp Duty payable on a £1 million property = £41,250
*This calculation assumes:
- you are not a first-time buyer
- that you are buying your primary residence
- that the sale will complete before 1st April 2025
If any of these criteria are not met your Stamp Duty costs will be different.
Stamp Duty changes
The current Stamp Duty bands were temporarily introduced in the aftermath of the Covid pandemic to encourage growth.
This temporary re-banding will be revoked on 1st April 2025. On the same date, the Stamp Duty threshold will return to its previous level of £125,000.
Stamp Duty bands after 1st April 2025
| Property price | Stamp Duty Land Tax (SDLT) rate |
| Up to £125,000 | 0% |
| £125,001 – £250,000 | 2% |
| £250,001 – £925,000 | 5% |
| £925,001 – £1.5 million | 10% |
| Over £1.5 million | 12% |
Stamp Duty Scotland
In Scotland, you are required to pay Land and Buildings Transaction Tax (LBTT) rather than Stamp Duty.
Similar to Stamp Duty, Land and Buildings Transaction Tax is charged in bands.
| Property price | Land and Buildings Transaction Tax rate |
| Up to £145,000 | 0% |
| £145,001 – £250,000 | 2% |
| £250,001 – £325,000 | 5% |
| £325,001 – £750,000 | 10% |
| Over £750,000 | 12% |
Stamp Duty Wales
In Wales, you are required to pay Land Transaction Tax (LTT) rather than Stamp Duty.
Land Transaction Tax (LTT) rates
| Property price | Land Transaction Tax (LTT) rate |
| Up to £180,000 | 0% |
| £180,001 – £250,000 | 3.5% |
| £250,001 – £400,000 | 5% |
| £400,001 – £750,000 | 7.5% |
| £750,001 – £1,500,000 | 10% |
| Over £1,500,000 | 12% |
First-time buyer Stamp Duty
Currently, first-time buyers in England and Northern Ireland are not required to pay any stamp duty up to the value of £425,000. This threshold will revert to £300,000 (pre-Covid level) on 1st April 2025.
First-time buyers’ relief is only available on properties costing up to £625,000. If the property you are buying costs more than £625,000, you will pay the normal rate of Stamp Duty. You will not be eligible for first-time buyers’ relief. From 1st April 2025 this will revert back to pre-Covid levels. This means you will only be eligible for first-time buyers’ relief on properties costing up to £500,000.
First-time buyers in Scotland (H3)
First-time buyers in Scotland are not required to pay any Land and Buildings Transaction Tax (LBTT) on the first £175,000.
First-time buyers in Wales (H3)
First-time buyers in Wales are exempt from having to pay Land Transaction Tax (LTT) on the first £225,000.
Stamp Duty on shared ownership
If you’re buying a shared ownership property you will have a choice about how you pay Stamp Duty. You can either choose to pay Stamp Duty for the full market value of the property or in stages. If you choose to pay total market value residential rate you will have nothing more to pay if you buy a greater share of the property in the future. Alternatively, if you choose to pay in stages you can pay Stamp Duty on the portion of the property you are initially buying (if above the Stamp Duty threshold) and then won’t need to pay any more Stamp Duty until you own more than 80% of the property.
Calculating Stamp Duty is a little more complicated on leasehold properties. You may need to pay extra Stamp Duty if the accumulated rent over the lifetime of the lease is more than the Stamp Duty threshold. You can use HMRC’s Stamp Duty calculator to work out how much Stamp Duty would be payable with each option.
Second home Stamp Duty
Stamp Duty on second homes is charged at a higher rate in England.
As of 31st October 2024, buyers are required to pay an additional 5% Stamp Duty on second homes or additional properties.
Stamp Duty rate for additional properties
| Property price | Additional property Stamp Duty rate |
| Up to £250,000 | 5% |
| £250,001 – £925,000 | 10% |
| £925,001 – £1.5 million | 15% |
| Over £1.5 million | 17% |
Additional Dwelling Supplement – Scotland (H3)
In Scotland, if you already own another property, you may be required to pay an additional 4% Land and Buildings Transaction Tax (LBTT) on anything costing more than £40,000.
Additional Dwelling Supplement – Wales (H3)
Wales also has an additional dwelling supplement. An additional 5% Land Transaction Tax (LTT) is payable on additional properties costing more than £40,000. This was increased from 4% in December 2024.
The supplement is due whether you are buying a second residential property or a buy-to-let investment property.
When do you pay Stamp Duty?
You ned to complete a Stamp Duty tax return and pay anything owed within 14 days of sale completion. Your solicitor (or conveyancer) will usually handle this for you but you are responsible for ensuring the tax return is filed and Stamp Duty paid on time.
Stamp Duty refunds
If you purchase a new main home before selling your current one, you will have to pay the additional 5% multiple property Stamp Duty. If you sell your current home within 3 years, you may be able to apply for a refund of the additional Stamp Duty you paid.
Stamp Duty calculator UK
Online Stamp Duty calculators can be very useful in helping you understand how much Stamp Duty (or Land and Buildings Transaction Tax or Land Transaction Tax, depending on where you’re buying) will be payable on your new property.
Stamp Duty calculator England (H3)
HMRC’s Stamp Duty calculator will tell you how much Stamp Duty is payable on your purchase in England or Northern Ireland.
Stamp Duty calculator Scotland (H3)
If you’re buying a property in Scotland, this Land and Buildings Transaction Tax (LBTT) calculator will help you calculate how much you will owe.
Stamp Duty calculator Wales (H3)
Buyers in Wales can use this Land Transaction Tax calculator to calculate how much they need to pay.
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Stamp Duty exemption
There are certain circumstances in which you may be eligible for Stamp Duty exemption. These include:
- First-time buyers, buying property costing up to £625,000 (reducing to £500,000 on 1st April 2025)
- Employers buying a property for an employee
- Companies transferring ownership of a property to another company
- Companies buying property for charitable purposes
- ‘Right to Buy’ property purchases
- Social Housing providers buying properties
- Property investment funds
You must still complete a Stamp Duty tax return, even if no Stamp Duty is payable.
There are lots of costs to consider when buying a property. Stamp Duty is often one of the biggest costs and can also feel like one of the most confusing. Hopefully this guide has made the topic a little more manageable. If in doubt, you should always consult your solicitor for tailored advice.
