What if I have to pay Stamp Duty?
Stamp Duty Explained: Rates in England and Northern Ireland
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This guide provides general information only. It is not financial advice or a personal recommendation and does not take account of your individual circumstances.
Quick answer
Stamp Duty Land Tax is paid on property purchases in England and Northern Ireland. For a home you will live in, it is 0% up to £125,000, 2% to £250,000, 5% to £925,000, 10% to £1.5 million and 12% above, charged on each slice of the price. First-time buyers pay nothing up to £300,000 on homes up to £500,000. Additional homes pay 5% more on each band.
Key figures
- is the 0% band for most home buyers
- £125,000
- is the 0% band for first-time buyers on homes up to £500,000
- £300,000
- on each band for additional properties of £40,000 or more
- +5%
How Stamp Duty is worked out
Stamp Duty Land Tax (SDLT) is charged in slices, like income tax. Each rate applies only to the part of the price that falls within its band, not to the whole price.
The Stamp Duty calculator works out the figure for your price and situation.
Standard rates
These apply if the property will be the only residential property you own:
| Part 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% |
Example: a £295,000 home costs nothing on the first £125,000, £2,500 on the next £125,000 (2%) and £2,250 on the last £45,000 (5%), so £4,750 in total.
First-time buyer relief
If you and everyone buying with you are first-time buyers and the home will be your main residence:
| Part of the price | Rate | |---|---| | Up to £300,000 | 0% | | £300,001 to £500,000 | 5% |
If the price is over £500,000, the relief can't be claimed and the standard rates apply. See the first-time buyer guide for the rest of the process.
Additional properties
If you will own more than one residential property at the end of the purchase day, for example a buy-to-let or a second home, higher rates apply: 5% more on each band. GOV.UK's example: an additional property for £300,000 costs £20,000.
The higher rates don't apply to properties under £40,000. If you are replacing your main home and sell the old one within three years, you can usually claim the extra back.
Non-UK residents
Buyers who haven't been in the UK for at least 183 days in the 12 months before the purchase usually pay an extra 2% on top of the other rates.
When it is paid
Your solicitor or conveyancer normally files the return and pays the tax on your behalf, usually from funds you provide before completion. It needs budgeting for alongside the deposit and other buying costs.
Frequently asked questions
As a first-time buyer in England or Northern Ireland, nothing. As a home mover replacing your main home, £5,000: 2% of £125,000 plus 5% of £50,000. As an additional property, £20,000.
Not on the first £300,000 of a home costing up to £500,000, if every buyer is a first-time buyer. Between £300,001 and £500,000 they pay 5%. Above £500,000 the standard rates apply.
No. Scotland has Land and Buildings Transaction Tax and Wales has Land Transaction Tax, each with its own rates and reliefs.
It is normally paid from your own funds through your solicitor on completion. Borrowing more to cover it would raise the loan to value, and whether that is possible depends on the lender.
Sources
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