Your insider’s guide to Stamp Duty Land Tax

Buying a home can be a confusing process, but it really doesn’t have to be.

What is the stamp duty tax, and when does it need to be paid?

If you’re interested in buying a property in England or Northern Ireland, and want to learn more about stamp duty tax, then you’re in the right place.

Stamp duty land tax (SDLT) in England and Northern Ireland is a form of tax that you might have to pay when you buy land or a property over a certain price. The rates are – when necessary – revised and updated by the Government, with the current stamp duty rates* and thresholds being:
  • £250,000 for residential properties
  • £425,000 for first time buyers who are purchasing a property worth £625,000 or less
  • £150,000 for non-residential land and properties
You can use HM Revenue and Customs’ (HMRC) stamp duty calculator to work out exactly how much you would need to pay, as properties of different values fall within different SDLT rate bands.

To pay your SDLT, you need to complete a return and have 14 days to pay the amount upon completion of the form. Your property lawyer and agent usually completes and files your return for you, so you don’t need to worry about any of it. Contact your local branch to find out more. 

First-time buyer stamp duty

If it’s your first property purchase, you may not have to pay stamp duty. As a first-time buyer, you can qualify for stamp duty relief, if the property you’re buying costs less than £425,000 or receive a discounted rate on properties worth up to £625,000**.

Stamp duty on additional properties

If you’re in the market for a second home, you must pay an additional 3% in stamp duty on top of the standard stamp duty rates, except for if the new property replaces your first property as your main home. 

Should you complete the purchase of your new property before you’ve sold your previous one, you will have to pay the additional 3%, as you would then own two properties. However, if you sell your previous home within 36 months of buying your new property, you can apply for a refund. Even if your sale takes longer than 36 months, reclaiming stamp duty can be done by writing to HMRC and explaining your circumstances.

Certain special rates also apply to non-UK residents, corporate entities, purchasing more than six residential properties in one transaction, shared ownership properties or linked purchases.

What are stamp duty holidays?

In certain special circumstances, such as the COVID-19 pandemic, stamp duty holidays are introduced where special rates are applied to the purchase of residential properties.

In Scotland, the equivalent is called Land and Buildings Transaction Tax (LBTT). Find out more about it here. For Wales, you’ll find more information on their Land Transaction Tax (LTT) here.

Are you selling your property before buying and wondering how much you could get for it?  

Get your free expert valuation