Stamp Duty Land Tax, usually shortened to SDLT or just "stamp duty", is the tax you pay when you buy a property or land over a certain price in England and Northern Ireland. It is one of the biggest upfront costs of a purchase, and for a buy-to-let it is often the single largest cost after the deposit. Here is what it is, who pays it, and exactly how the figure is worked out.
What is Stamp Duty Land Tax?
SDLT is a tax on buying property. It applies to freehold purchases, new and existing leaseholds, and property bought through a shared-ownership scheme, in England and Northern Ireland. Scotland and Wales have replaced it with their own taxes, covered at the end.
You pay it on the "consideration", which is normally the purchase price, though it can include other things of value given as part of the deal. The tax is banded, so you only pay each rate on the slice of the price that falls in that band.
Who pays stamp duty, and when?
The buyer pays SDLT, not the seller. You have to send HMRC an SDLT return and pay what is due within 14 days of completion, as set out on GOV.UK. In practice your solicitor or conveyancer files the return and takes the money as part of the completion funds, so you rarely deal with HMRC directly, but the legal responsibility is yours.
There is no stamp duty to pay, and often no return to file, if the price is below the nil-rate threshold, but check with your solicitor because some purchases still need a return even when the tax is zero.
How stamp duty is calculated
Stamp duty is worked out in slices, like income tax. Each band has a rate, and you pay that rate only on the part of the price within the band, not on the whole amount. That is why the "effective rate" you actually pay is always lower than the top band your price reaches.
Take a £350,000 home for someone moving house at the standard 2026 rates:
- 0% on the first £125,000 = £0
- 2% on the next £125,000 (to £250,000) = £2,500
- 5% on the final £100,000 (to £350,000) = £5,000
That is £7,500 in total, an effective rate of about 2.1%, even though the top band is 5%. The full stamp duty rates and thresholds set out every band.
Do landlords and first-time buyers pay differently?
Yes, and this is where most of the money is.
- Buy-to-let and second homes pay a 5% surcharge on top of every band, so the same £350,000 property would cost a landlord far more. The buy-to-let stamp duty surcharge is the reason.
- First-time buyers pay nothing up to £300,000 and 5% on the slice to £500,000, with no relief above £500,000.
A company buying residential property always pays the additional-dwelling rates, no matter how many properties it owns.
Scotland and Wales
SDLT only covers England and Northern Ireland. In Scotland you pay Land and Buildings Transaction Tax (LBTT), with its own bands and a 6% Additional Dwelling Supplement on second homes. In Wales you pay Land Transaction Tax (LTT). The thresholds and rates are different in each, so do not rely on SDLT figures for a Scottish or Welsh purchase.
Work out your stamp duty
To see the tax on your exact price, use the free stamp duty calculator. Pick home mover, first-time buyer or buy-to-let and it applies the right bands and shows the slice-by-slice breakdown. If you are buying to let, budget for the surcharge alongside the mortgage using the buy-to-let mortgage calculator before you commit.
