Stamp Duty Land Tax explained — UK guide (2026)
Stamp Duty Land Tax (SDLT) is a tax paid by buyers of residential property in England and Northern Ireland. Scotland has its own equivalent tax — Land and Buildings Transaction Tax (LBTT) — and Wales charges Land Transaction Tax (LTT). All three operate on a marginal band basis: only the portion of the price within each band is taxed at that band’s rate.
How the marginal system works
The marginal system is frequently misunderstood. On a £300,000 property in England, the 5% rate does not apply to the whole price — it only applies to the portion above £250,000 (£50,000 in this example), giving £2,500. The 2% band applies to £125,001–£250,000 (£2,500), and the 0% band covers the first £125,000. Total SDLT: £5,000, not £15,000. This is why the effective rate (total tax ÷ purchase price) is always lower than the top headline rate.
First-time buyer relief
From 1 April 2025, first-time buyers in England pay no SDLT on the first £300,000 of a property purchase, and 5% on the portion between £300,000 and £500,000. For properties above £500,000, no relief applies and standard rates are charged from £0. This relief can save up to £10,000 for eligible buyers. In Scotland, LBTT first-time buyer relief gives a zero-rate band up to £175,000.
Additional dwelling surcharge
Buyers of additional residential properties — second homes, buy-to-let investments, or holiday homes — pay a surcharge on the full purchase price on top of standard rates. In England this is 5% (raised from 3% in October 2024), in Scotland 8% (ADS), and in Wales 4%. The surcharge applies from the first pound of the purchase price, so it can significantly increase the total tax for higher-value purchases. If you are selling your main residence and buying a new one, the additional surcharge may be refunded within three years.
Payment and process
SDLT in England must be filed and paid within 14 days of completion. Your conveyancing solicitor submits the SDLT return to HMRC on your behalf and pays the tax from the completion funds — you don’t need to do anything separately. In Scotland (LBTT) and Wales (LTT) the deadline is 30 days from completion. This calculator is reviewed by Sarah Okafor (ICAEW ACA).