What is stamp duty?
Stamp duty land tax (SDLT) is a tax that you need to pay when you buy a property over a certain price in England or Northern Ireland. In Scotland, it’s known as Land and Buildings Transaction Tax (LBTT), and in Wales it’s called Land Transaction Tax (LTT) with rates set locally.
The amount of stamp duty you pay is calculated using the purchase price of a property, not the amount you’re borrowing through a mortgage.
How much is stamp duty now?
Stamp duty rates have changed as of 1 April 2025. Here's how much stamp duty you'll pay if you've bought another property in the past and are not a first-time buyer:
Nothing on the first £125,000
2% on the portion of the property price between £125,001 and £250,000
5% on the portion of the property price between £250,001-£925,000
10% on the portion of the property price between £925,001 and £1.5 million
12% on any remaining amount above £1.5 million
Stamp duty for first-time buyers
First-time buyers can claim a 'relief' (discount) on stamp duty as long as the property costs no more than £500,000.
You'll pay no stamp duty at all on the first £300,000, then
5% on the portion of the property price between £300,001 and £500,000.
If the property costs more than £500,000, you won't qualify for the relief.
Stamp duty for buy-to-let properties and second homes
Stamp duty on a second home or buy-to-let property costs an extra 5% on top of the standard stamp duty rates.
You normally don’t have to pay the additional tax if your second home is moveable – for example, if it’s a caravan, mobile home or houseboat.
The 5% surcharge also applies if:
Your main home is abroad and the second home you buy is in the UK
The second home is bought via a limited company.
Getting a refund for higher rates of stamp duty
If you buy a new home before you're able to sell your old home, you’ll have to pay the higher rate of stamp duty as you’ll own two properties.
However, if you can sell (or even give away) your old home within three years of buying your new one, you can apply for a refund on the amount charged at the higher rate for additional properties. That gives you some time to get things sorted, but you’ll still need to pay the higher rate to begin with.
To be eligible for the refund, you must also claim within 12 months of selling your old home or 12 months of filing your stamp duty tax return, whichever of those is later.
You can apply for a refund on the GOV.UK website.
Who has to pay stamp duty?
Ordinarily, you should expect to pay stamp duty on all property purchases that exceed the applicable minimum SDLT threshold. That includes leasehold properties, shared ownership properties and purchases that don’t involve a mortgage.
So when buying a home, you need to consider whether you’ll be able to afford the stamp duty on top of all the other costs involved.
When are you exempt from stamp duty?
There are only a few exemptions to the need to pay stamp duty. These include:
When a portion of a home is transferred to a spouse or partner following a separation or divorce
When you transfer the deeds of your home to another person as a gift
When a property is left to you in a will
If you are buying a property with an Islamic mortgage to comply with Sharia law. In this case the home purchase plan (HPP) provider should pay SDLT when they buy the property.
When do you have to pay stamp duty by?
Once you’ve bought your new home, you (or your solicitor) will need to file a stamp duty land tax return and pay the amount due within 14 days of exchanging contracts in England and Northern Ireland. If you don’t do this within 14 days, you’ll be charged penalty fees by HMRC.
How to pay stamp duty
Most of the time, your solicitor or conveyancer will sort this out for you and add the amount to your fees. If you’d rather do it yourself, you’ll need to fill out and submit a stamp duty land tax return form.
Whether you use a solicitor or not, it’s your responsibility to ensure that the return is filed correctly with HM Revenue & Customs. Make sure you do it within the set time to avoid penalty fees.
A return must still be submitted even if no stamp duty is payable.
What are stamp duty rates?
See the table below for current stamp duty rates for home movers and people who have owned other properties in the past. You can also use our stamp duty calculator.
Stamp duty rates from 1 April 2025
Portion of the property price | Stamp duty rate |
|---|---|
Up to £125,000 | Zero |
Portion from £125,001 to £250,000 | 2% |
Portion from £250,0001 to £925,000 | 5% |
Portion from £925,001 to £1.5 million | 10% |
Anything above £1.5 million | 12% |
These rates apply if you’re buying property in England and Northern Ireland.
See our guide to LTT rates for buying properties in Wales, or LBTT rates for buying in Scotland.
Can I add stamp duty to my mortgage?
Yes, you can add your stamp duty payment to your mortgage. But you should be aware that it will affect the loan-to-value (LTV) ratio of your mortgage and incur interest charges.
If your mortgage is set to be paid over a long period of time, for example 25 or 30 years, the interest will really add up. So it's usually much cheaper to pay it straight away if you can.
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When considering mortgage affordability, it’s important to know that your home or property may be repossessed if you do not keep up with your mortgage repayments. Therefore, you need to make sure that you’re comfortable with the monthly repayments for your agreed term.
FAQs
What is a stamp duty threshold?
Stamp duty thresholds are simply the limits to when and which charges apply. If you buy a property for less than the base threshold, you won’t pay any stamp duty. But if the property you’re buying exceeds other thresholds, you’ll need to pay more. See more on stamp duty thresholds on GOV.UK.
Do I qualify for stamp duty relief if I’m a first-time buyer buying with someone else?
If you’re buying a property with someone else, you’ll both need to be buying your first home to qualify for the stamp duty relief for first-time buyers.
The government defines a first-time buyer as 'an individual or individuals who have never owned an interest in a residential property in the United Kingdom or anywhere else in the world and who intends to occupy the property as their main residence'.
How much stamp duty do you pay if you’re not a UK resident?
If you’re not a UK resident, you’ll normally pay a 2% surcharge on top of standard SDLT rates to buy a residential property in England and Northern Ireland.
For SDLT purposes, you won’t be classed as a UK resident if you spend more than six months (183 days) outside of the UK in the 12 months before you purchase the property.
Does stamp duty apply if I buy a commercial or mixed property?
Stamp duty does apply if you buy a commercial or mixed property, but at different rates to residential property. A mixed property could be, for example, a flat above a shop.
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