Buying a Home? Here’s the Easy Guide to Stamp Duty Tax

Buying a property in England or Northern Ireland? Understanding Stamp Duty Land Tax (SDLT) is crucial. The tax applies based on the property’s price, the purchase date, and your eligibility for reliefs or exemptions. Here’s a detailed guide to help you navigate SDLT rates, thresholds, and calculations easily.

 What Is SDLT and When Do You Pay It?

SDLT is a tax paid when purchasing residential property, such as a house or flat. The tax amount varies depending on:

• When you bought the property.
• How much you paid.
• Your eligibility for relief or exemptions.

 Use the SDLT calculator to estimate your tax.

 SDLT Rates for a Single Property

You pay SDLT based on the property price’s increasing portions. If you own another property, you’ll pay 5% more on top of these rates.

Rates Until 31 March 2025:

Property Price Range	SDLT Rate
Up to £250,000	0%
£250,001 to £925,000 (next £675,000)	5%
£925,001 to £1.5 million (next £575,000)	10%
Above £1.5 million	12%

Example:
Buying a house for £295,000 in October 2024:

• 0% on the first £250,000 = £0
• 5% on the remaining £45,000 = £2,250
  Total SDLT: £2,250

Rates from 1 April 2025:

Property Price Range	SDLT 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:
Buying a house for £295,000 in April 2025:

• 0% on the first £125,000 = £0
• 2% on the next £125,000 = £2,500
• 5% on the remaining £45,000 = £2,250
  Total SDLT: £4,750

 SDLT on New Leasehold Sales and Transfers

When purchasing a new residential leasehold property, you pay SDLT on the lease premium based on the same rates as above.

However, if the net present value (NPV) of the lease’s total rent exceeds:

• £250,000 (until 31 March 2025)
• £125,000 (from 1 April 2025)

You’ll pay 1% SDLT on the portion above the threshold.

 Use the SDLT calculator to find your lease tax.

 SDLT Relief for First-Time Buyers

First-time buyers enjoy SDLT relief, but the discount changes in April 2025.

Discount Until 31 March 2025:

• 0% on the first £425,000.
• 5% on the portion from £425,001 to £625,000.
• No relief if the property exceeds £625,000.

Example:
Buying your first home for £500,000:

• 0% on £425,000 = £0
• 5% on £75,000 = £3,750
  Total SDLT: £3,750

Discount from 1 April 2025:

• 0% on the first £300,000.
• 5% on the portion from £300,001 to £500,000.
• No relief if the property exceeds £500,000.

Example:
Buying your first home for £500,000:

• 0% on £300,000 = £0
• 5% on £200,000 = £10,000
  Total SDLT: £10,000

 Higher SDLT Rates for Additional Properties

If buying a new property means you own more than one, you’ll usually pay 5% more on top of the standard rates.

Exceptions:

• If you sell your old home within 36 months of buying the new one.
• If you’re replacing your main residence.

Check SDLT refund eligibility if you meet these conditions.

SDLT Rates for Non-UK Residents

If you haven’t spent 183 days (6 months) in the UK during the 12 months before your purchase, you’re considered a non-UK resident for SDLT purposes.

You’ll pay a 2% surcharge on top of regular rates.

This applies even if:

• You’re buying an additional property.
• You’re a first-time buyer.

Check SDLT surcharge eligibility for international buyers.

Understanding SDLT rates and thresholds is essential for budgeting your property purchase. Use the HMRC SDLT calculator to get an accurate estimate and avoid surprises. Whether you’re a first-time buyer or an investor, knowing when rates change in April 2025 can help you plan better.

FAQ’s