Residential Stamp Duty Calculator

What is stamp duty?

Stamp Duty Land Tax (SDLT) applies to the purchase of land or property in England or Northern Ireland, and a similar tax is in place in Scotland called Land and Buildings Transaction Tax (LBTT). In Wales, it is called Land Transaction Tax (LTT). 

Please note - The following information is to be used as a guide only.

Historically, Stamp Duty (a tax on legal documents that had to be “stamped” at the Government stamp office) has been around in various guises since 1694. Stamp duty on transactions in land was reformed in 2003 so that it is technically no longer a tax on the legal documents, but a form of self-assessed transfer tax charged on "land transactions" – and it was re-branded as Stamp Duty Land Tax.  This is now a tax imposed on the purchase of property or land above a certain value threshold.

Like all tax rates and legislation, stamp duty has changed over the years. Rates of tax charged on high-value properties have increased dramatically since 2000 with a maximum (unsurcharged) rate of 12% – and this has been offset by periodic short term reductions designed to stimulate the property market at times of economic shock.

In response to the COVID-19 crisis, property buyers in England and Northern Ireland received a “holiday” from stamp duty on the first £500,000 of each transaction, from the 8th of July 2020 to the end of June 2021. From the 1st  of July 2021, the stamp duty free limit was reduced to £250,000.

From the 1st  of October 2021, rates reverted to pre-2020 requirements with stamp duty in England and Northern Ireland starting at 2% on values over £125,000. It is important to note that England and Northern Ireland, Wales, and Scotland have separate taxes applicable to residential property purchases with slightly different rates and special discounts.

Please note that the following is based on purchases by UK residents and that additional costs may apply for non-UK residents. If you are a BTL purchaser and not a first-time buyer, buy to let stamp duty is also higher for additional homes.

What is stamp duty payable on?

• The purchase of a freehold property
• The purchase of a new or existing leasehold property
• The purchase of a property through a shared ownership scheme
• Land or property which is transferred in exchange for payment
• The threshold for owing SDLT starts at £125,000 for residential properties and £150,000 for commercial properties
• Since 1 April 2016, there has been a 3% surcharge on the purchase of second and subsequent residential properties applicable to purchases costing more than £40,000

SDLT should not be confused with:

• Stamp Duty on the purchase of shares (using a stock transfer form) due at 0.5% (if the value is over £1,000)
• Stamp Duty Reserve Tax on the electronic purchase of shares – usually due at 0.5% but can be up to 1.5% for transfers into a depositary receipt scheme or a clearance service other than CREST

What counts as a non-residential property?

Non-residential property includes:

• commercial property, e.g., shops or offices
• agricultural land
• forests
• any other land or property which is not used as a residence
• six or more residential properties bought in a single transaction
• “mixed-use” property

A “mixed-use” property has residential and non-residential elements, e.g., a flat connected to a shop, doctor’s surgery or office. 

Click here for information on stamp duty for non-residential property.

How much is stamp duty, and what can I expect to pay on a residential property?

The four countries making up the United Kingdom have different legislation supporting the taxes and different rates of stamp duty.

England and Northern Ireland - Stamp Duty Land Tax

England and Northern Ireland SDLT Rates

The basic rates of SDLT applicable to the value of the property are as follows: 

As a first-time homebuyer, you will be eligible for a lower rate of SDLT if you are spending less than £500,000 on the property. In that case, the SDLT rate is nil on the first £300,000 and 5% between £300,001 and £500,000.  If you spend over £500,000 the entire “discount” is lost, and the full rates above are payable.

Example 1:

On a residential property priced at £200,000, SDLT would be payable on:
0% up to £125,000
2% of £75,000 (the amount above £125,000) = £1,500
Total SDLT payable: £1,500

Example 2:

On a residential property priced at £535,000, SDLT would be payable on:
0% up to £125,000
2% of £125,000 (the amount between £125,00 - £250,000) = £2,500
5% of £285,000 (the amount above £250,001) = £14,250
Total SDLT payable: £16,750

You can also work out how much you will pay using our Residential Stamp Duty Calculator.

Overseas investors

Since 1st April 2021, an additional 2% stamp duty surcharge was introduced for overseas buyers purchasing residential property in England and Northern Ireland.

First-time buyer stamp duty rates

Since November 2017, there has been a reduced scale of stamp duty for first time home buyers.  There are essentially three conditions of eligibility:

• The purchaser (or both purchasers if it is a joint purchase) must not at any time previously have owned any residential property in the UK – nor must they have owned a partial share in a residential property
• The property must cost £500,000 or less
• The purchaser(s) must intend to live in the property

The reduced scale is as follows:

When is the SDLT flat rate of 15% applied?

SDLT is charged at 15% on the entire value of residential properties costing more than £500,000 bought by certain corporate bodies - or ‘non-natural persons’. These include:

•          companies
•          partnerships including companies
•          collective investment schemes

The 15% rate doesn’t apply to property bought by a company that is acting as a trustee of a settlement or bought by a company to be used for:

•          a property rental business (i.e. buy to let)
•          property developers and trader
•          property made available to the public
•          financial institutions acquiring property in the course of lending
•          property occupied by employees
•          farmhouses

The standard residential rate of SDLT applies in these cases.

Essentially this flat rate of SDLT is designed to tax properties purchased by foreign nationals within a UK limited company – and which would normally escape any SDLT on resale through the simple expedient of selling shares in the company (attracting just 0.5% Stamp Duty). 

Buy to Let property and second homes

A surcharge of 3% of the total purchase price will apply to purchases of additional residential properties, such as buy to let properties and second homes (including all residential property purchases by limited companies). The surcharge will be applied even if you own just a share in another property so long as that share is worth more than £40,000.

Example 1:

On a buy to let property priced at £200,000, SDLT would be payable on:
0% up to £125,000
2% of £75,000 (the amount above £125,000) = £1,500
3% surcharge on £200,000 = £6,000
Total SDLT payable: £7,500

Example 2:

On a buy to let property priced at £535,000, SDLT would be payable on:
0% up to £125,000
2% of £125,000 (the amount between £125,00 - £250,000) = £2,500
5% of £285,000 (the amount above £250,001) = £14,250
3% surcharge on £535,000 = £16,050
Total SDLT payable: £32,800

Exemptions

Certain cases are, in the main, exempt from the higher 3% levy, including:

• timeshares
• if you inherit a property (although an inherited property will be relevant when determining if a purchaser is buying an additional residential property or not)
• caravans
• mobile homes
• houseboats
• transactions under £40,000. 
• non-residential property 

Scotland - Land and Buildings Transaction Tax

Land and Buildings Transaction Tax (LBTT) Rates

In Scotland, you will be liable for Land and Buildings Transaction Tax rather than SDLT. The basic rates of LBTT applicable to the value of the property are as follows:

For example, suppose you are a UK resident and sole purchaser of a freehold residential property for £145,000 in Scotland that will be transferred into your name after the 1st of October 2021. In that case, you will pay no land transaction tax. However, on a property purchased for £300,000, you will be liable for £4,400 in Land and Buildings Transaction Tax. There is a first-time buyer reduction in LBTT, increasing the nil rate band to £175,000.

Scotland also implements an Additional Dwelling Supplement (ADS) for second home buyers and BTL property buyers, similar to the SDLT surcharge in England, which is charged at 4% of the property's total purchase price.

Wales - Land Transaction Tax 

Land Transaction Tax (LTT) Rates

In Wales, you pay Land Transaction Tax rather than SDLT. The basic rates of LTT applicable to the value of the property are as follows:

For example, if you are a UK resident and sole purchaser of a freehold residential property for £160,000 in Wales that will be transferred into your name after the 1st of October 2021, you will pay no Land Transaction Tax. However, on a property purchased for £300,000, you will be liable for £4,950 in Land Transaction Tax.

Surcharges on Buy to Let and Second Home Purchases

Wales also implements a surcharge similar to the SDLT surcharge in England for second home buyers and BTL property buyers, which is charged at 4% of the property's total purchase price. There are no special discounted rates of LTT for first time home buyers in Wales.

Who pays stamp duty?

The home buyer will pay stamp duty.

When must stamp duty be paid?

All residential property buyers need to note that you currently have a maximum of 14 days to file your SDLT return in England and Northern Ireland and pay the due tax. In Wales and Scotland, this deadline is 30 days for their equivalent taxes. In most cases, the filing of these returns will be handled by solicitors responsible for the purchase transaction.

How to pay stamp duty

While it is your legal responsibility to settle your stamp duty, the solicitor managing the transfer of your property will most likely sort out the details and give you payment instructions well within the required 14 days in which you have to pay. If you are unsure about this, please don’t hesitate to contact your mortgage broker for advice.

You can also pay using the following method:

• Visit the HM Revenue & Customs website- Submit your return to register the transaction. You may also be able to visit them in person.
• Find your unique transaction reference number – This is an 11-character number on your submission receipt (online) or paper stamp duty return.

Make the payment to HM Revenue & Customs – Keep in mind that bank transfers may take up to 3 working days to reflect, so be sure to pay with this in mind. You can also use faster payment methods, including CHAPS payments. It should be noted that you cannot use a credit card to pay stamp duty.

How to pay land transaction tax in Scotland and Wales

Scotland

Your solicitor can handle this process for you, or you can pay using the following method:

• Visit the Revenue Scotland website - Submit your return to register the transaction. You may also be able to visit them in person.
• Find transaction reference – This is a 13-character number on your online return, beginning with ‘RS’.

Make the payment to Revenue Scotland - Keep in mind that bank transfers may take up to 3 working days to reflect, so be sure to pay with this in mind. You can also use faster payment methods, including CHAPS payments. It should be noted that you cannot use a credit card to pay stamp duty.

Wales

Your solicitor can handle this process for you, or you can pay using the following method:

• Visit the Welsh Revenue Authority website – Submit your return to register the transaction. You may also be able to visit them in person.
• Find your unique transaction reference number – This is a 12-character number on your online return, beginning with ‘RS’. You can also use the following reference on your payment if needed – the postcode of your property and the surname of the buyer. For example, SA52/Smith.

Make the payment to the Welsh Revenue Authority- Keep in mind that bank transfers may take up to 3 working days to reflect, so be sure to pay with this in mind. You can also use faster payment methods, including CHAPS payments. It should be noted that you cannot use a credit card to pay stamp duty.

What are “Enveloped” buildings and how does this affect SDLT?

Established in 2012, ATED (“Annual Tax on Enveloped Dwellings”) is an annual tax payable mainly by companies that own UK residential property valued at more than £500,000.  The tax is calculated in bands and starts at £3,500 per year for properties valued at between £500,000.01 and £1,000,000.

Some properties aren’t classed as dwellings. These include:

•          hotels
•          guest houses
•          boarding school accommodation
•          hospitals
•          student halls of residence
•          military accommodation
•          care homes
•          prisons

You may be able to claim relief for your property if it is:

• let to a third party on a commercial basis and isn’t, at any time, occupied (or available for occupation) by anyone connected with the owner – i.e., buy to let is not liable to this tax, although annual ATED returns may be required
• open to the public for at least 28 days a year
• being developed for resale by a property developer
• owned by a property trader as the stock of the business for the sole purpose of resale
• repossessed by a financial institution as a result of its business of lending money
• being used by a trading business to provide living accommodation to certain qualifying employees
• a farmhouse occupied by a farm worker or a former long-serving farm worker
• owned by a registered provider of social housing

As with the SDLT flat rate of 15%, this is designed to ensure that residential properties bought by foreign nationals cannot avoid all UK taxation (in particular taxes that would otherwise be due on resale, such as CGT and SDLT). 

Stamp duty land tax – Frequently asked questions

Is the first dwelling purchased by a Ltd Company exempt from the 3% surcharge?

No. All purchases of residential property within a limited company are subject to the surcharge.

I own a rental property; will I have to pay the 3% surcharge when buying my first home?

Yes. The number of dwellings you own, not the use to which they are put, that determines whether the surcharge is payable.

I want to buy a mixed-use property; will I have to pay residential or non-residential SDLT rates?

Mixed-use properties are subject to non-residential rates of SDLT, and there is no SDLT surcharge.

Also called semi-commercial property, mixed-use properties have residential and commercial components e.g., a shop with a flat above, owned on the same freehold, or a guest house with separate owner accommodation. 

If you already own a mixed-use property that includes a dwelling within it, a subsequent purchase of residential property may be deemed to be the purchase of a second dwelling and therefore attract the 3% SDLT surcharge. If you are in this situation, we strongly advise you to seek specialist advice.

My partner owns a property that we intend to rent out once we have bought our new home together. Will we pay the 3% surcharge, and if so, on what property?

Yes, the surcharge will be due on the new purchase as your partner will have an interest in more than one dwelling.

I am buying a new home but I want to keep hold of my old home and turn it into a buy to let, will I have to pay the Stamp Duty surcharge on the new purchase?

Yes.

I am buying a new home and I plan to sell my old one; will I have to pay the Stamp Duty surcharge on the new purchase?

If you sell your old home and buy a new one simultaneously, you will not have to pay a surcharge. If you do not sell your existing home at the same time as you buy a new one, in effect, you will own two properties which means that you will be liable for SDLT and the surcharge on the new property. However, if you sell your old home within 36 months of buying the new one, you can apply to HMRC to have the surcharge refunded. To benefit from this, the home being sold will need to have been your main or only home at some point during the 36 months leading up to buying the new one.

I am about to inherit a house; will I have to pay stamp duty on it?

No. However, if you then purchase another residential property, you will have to pay SDLT and the surcharge on the purchase.

My wife owns a property and now I want to buy solely a new home for us to live in. Will I have to pay the surcharge?

Yes. Married couples and civil partners are treated as one entity, so you will be obliged to pay the relevant rate of SDLT on the purchase plus a 3% surcharge on the total purchase price.  

This rule does not apply to co-habiting couples, and so long as there is no legal relationship (marriage or civil partnership) between you at the date of completion of the purchase, then no surcharge is due.

I own a property overseas and now want to buy a house in the UK; will I have to pay the 3% surcharge?

Yes, even if you own the other property in Scotland.

I am buying a warehouse and plan to convert it into residential apartments; will I pay the 3% surcharge?

No. The use at the time of purchase determines whether the property is a “dwelling” subject to the surcharge. This would apply even if there were planning permission for a change of use to residential. However, if work had already commenced on conversion to residential use, it is likely that the residential rates of SDLT – including the 3% surcharge – would apply.

I am buying a residential building and intend to convert it (or demolish and rebuild) to office use; will I pay the 3% surcharge?

Yes, because the property you intend to buy is a dwelling (“is used or suitable for use as a single dwelling” is the key legal criterion) at the time of purchase.  However, if you negotiate a provision in the contract (for the vendor) to demolish the house before completion, you could legitimately avoid the surcharge.  Use at the effective date of the transaction overrides any past or intended future uses for this purpose. If a building is not in use at the effective date, but its last use was as a dwelling, it will be considered ‘suitable for use as a dwelling’ and treated as residential property unless evidence is produced to the contrary.

I own a buy to let property in a limited company and now want to buy a home to live in – will I pay the 3% surcharge? 

A limited company is a separate legal “person” from you, so (legally) you do not currently own a “dwelling”. Consequently, you will not have to pay the 3% surcharge when you buy your home.

How much SDLT can I expect to pay on land purchase?

Undeveloped land is essentially non-residential but may be residential property if a residential building is being built on it at the effective date. Existing buildings are treated as residential property if, at the effective date, it is being adapted or marketed for or restored to domestic use.

Do you have questions about stamp duty or our STLD calculator?

If you have any questions about our residential stamp duty calculator or want to speak to a mortgage broker about buying a residential property or BTL investment, our team is ready to assist you. With over 20 years of experience and access to the widest range of lenders, we’re here to help you make your property ownership dreams a reality.

The information provided should be used as a guide only, and we recommend that all clients take qualified tax advice.