Stamp Duty

What is Stamp Duty?

Stamp duty is a tax payable when buying residential property or land in the UK. The amount depends on where you buy, the property value, and your circumstances—whether you’re a first-time buyer, moving home, or purchasing an additional property.

In England and Northern Ireland, this tax is called Stamp Duty Land Tax (SDLT). Scotland and Wales have their own property transaction taxes: Land and Buildings Transaction Tax (LBTT) in Scotland and Land Transaction Tax (LTT) in Wales, each with different rules, rates, and thresholds.

How Is Stamp Duty Calculated?

Stamp duty is charged on a tiered basis, meaning you pay different rates on portions of the property price within each tax band. For example, you won’t pay stamp duty on the portion of the price that falls under the lowest threshold, and higher rates apply only to amounts above that.

Whether you are a first-time buyer or buying an additional property also affects the rate you pay. If you’re buying a second home or a buy-to-let property, you may have to pay an additional surcharge.

Stamp Duty Rates in England and Northern Ireland

If you’re purchasing a residential property in England or Northern Ireland and it’s your main home, the current rates (as of April 2025) are:

Property Price Stamp Duty 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%

Over £1.5 million 12%

Source: Gov.uk

First-Time Buyer Stamp Duty Relief

First-time buyers benefit from higher thresholds. You pay no stamp duty on homes costing up to £300,000. A 5% rate applies only to the portion between £300,001 and £500,000. Properties over £500,000 do not qualify for relief and are taxed at standard rates.

Stamp Duty on Additional Properties

If you’re buying an additional property, such as a second home or buy-to-let, an extra 3% surcharge usually applies on top of the standard rates. If you’re replacing your main home, you won’t have to pay this surcharge, provided you sell your previous home within 36 months.

Stamp Duty in Scotland and Wales

Scotland (LBTT): Tax-free threshold is £145,000 (£175,000 for first-time buyers). Rates increase on a tiered basis, with an 8% Additional Dwelling Supplement for extra properties over £40,000.

Wales (LTT): Tax-free threshold is £225,000 with rates rising incrementally. There is no first-time buyer relief, and higher rates apply for additional properties.

Why Understanding Stamp Duty Is Important

Stamp duty is a key part of property conveyancing and a significant cost to consider when buying a home. Knowing how much you might owe helps you budget effectively and avoid surprises in your property purchase process.