How Does Stamp Duty Land Tax Work in 2026?

Last reviewed: 8th June 2026

Summary

SDLT is a tax paid on completion of a residential property purchase in England or Northern Ireland, calculated in bands on the purchase price. As of June 2026, the standard nil-rate band stands at £125,000, with rates of 2%, 5%, 10%, and 12% applying to successive portions above that. First-time buyers benefit from a higher nil-rate band of £300,000 provided the purchase price is no more than £500,000. In contrast, buyers of additional properties pay a 5% surcharge on top of every standard rate band.

Key Points

- Stamp Duty Land Tax (SDLT) applies to residential property purchases in England and Northern Ireland only; in Scotland, Land and Buildings Transaction Tax applies, and in Wales, Land Transaction Tax applies.

- The standard nil-rate band reverted to £125,000 on 1 April 2025, so buyers now pay 2% on the portion of the purchase price between £125,001 and £250,000 and 5% on the portion between £250,001 and £925,000.

- First-time buyers pay no SDLT on the first £300,000 and 5% on the portion up to £500,000, but the relief disappears entirely if the purchase price exceeds £500,000.

- Anyone buying an additional residential property pays a surcharge of 5 percentage points on top of the standard rates, following the autumn 2024 Budget increase from 3% to 5% with effect from 31 October 2024.

- Multiple Dwellings Relief was abolished for transactions completing on or after 1 June 2024, so buyers of two or more properties in a single transaction can no longer reduce their SDLT bill through that route.

Stamp Duty Land Tax is charged on the completion of a qualifying property transaction in England and Northern Ireland, and the rates in force today are materially different from those that existed even a year ago. Two significant changes took effect in quick succession: the second-home surcharge rose from 3% to 5% in October 2024, and the temporarily raised thresholds that had applied since 2022 reverted to their pre-2022 levels on 1 April 2025. Those changes together mean that many buyers face a higher tax bill than they would have done in the preceding two years.

Whether you are buying your first home, moving up the ladder, or adding to an investment portfolio, understanding where the current thresholds sit is essential before you budget for a purchase. Your solicitor will calculate the exact SDLT figure and submit the return to HMRC within 14 days of completion, but the calculation should never come as a surprise.

Current SDLT Rates for Standard Residential Purchases

The current rates apply where the buyer will own only one residential property after the transaction completes. SDLT is charged on a slice basis, meaning each rate applies only to the portion of the purchase price that falls within a given band, not to the whole price.

The bands as confirmed by HMRC on gov.uk are:

- 0% on the first £125,000

- 2% on the portion from £125,001 to £250,000

- 5% on the portion from £250,001 to £925,000

- 10% on the portion from £925,001 to £1,500,000

- 12% on the portion above £1,500,000

To illustrate, a buyer purchasing a family home in Solihull for £350,000 would pay: nothing on the first £125,000, £2,500 on the next £125,000 at 2%, and £5,000 on the final £100,000 at 5%, giving a total SDLT bill of £7,500. Under the transitional thresholds that applied before 1 April 2025, the same buyer would have paid £5,000, because the nil-rate band extended to £250,000 and no 2% band existed. The reversion has therefore increased the tax cost on that transaction by £2,500.

If you are buying a new leasehold property, SDLT applies both to the purchase premium (using the band rates above) and to the net present value of the rent over the lease term. Where that net present value exceeds £125,000, SDLT is charged at 1% on the excess. This leasehold element is separate from any SDLT on the premium and is calculated and paid alongside it.

Our residential conveyancing solicitors in Solihull can calculate both elements and advise on the total SDLT liability before you exchange contracts.

First-Time Buyer Relief

First-time buyers of residential property in England and Northern Ireland can claim a relief that raises their nil-rate band and removes the 2% slice from their calculation. As confirmed by gov.uk, the current relief works as follows:

- 0% on the first £300,000

- 5% on the portion from £300,001 to £500,000

- No relief at all if the purchase price exceeds £500,000

To claim the relief, every buyer in the transaction must be a first-time buyer. If one buyer has previously owned a residential property anywhere in the world, the relief is lost entirely and the standard rates apply to the whole purchase.

Suppose a buyer in Sutton Coldfield is purchasing their first home for £400,000. Under the current relief they pay nothing on the first £300,000 and 5% on the remaining £100,000, giving an SDLT bill of £5,000. Without the relief, using the standard rates, the same buyer would pay £2,500 on the slice from £125,001 to £250,000 and £7,500 on the slice from £250,001 to £400,000, a total of £10,000. The relief saves £5,000 on that transaction.

If that same buyer increased their budget to £510,000, the relief would disappear entirely and the full standard rate calculation would apply to the whole price. The potential SDLT on a £510,000 purchase at standard rates would be £2,500 plus £13,000, giving £15,500. Buyers hovering near the £500,000 ceiling should take advice before committing to a purchase price, because crossing that threshold removes a meaningful saving.

It is worth noting that the pre-April 2025 first-time buyer thresholds, which stood at £425,000 for the nil-rate band and £625,000 for the relief cap, no longer apply. Any buyer who is in the early stages of planning and relied on older published guidance should verify the current figures before proceeding.

Higher Rates for Additional Dwellings

Buyers who will own more than one residential property after the transaction completes pay a surcharge on top of every standard SDLT band. Following the autumn 2024 Budget, that surcharge is 5 percentage points, having risen from 3 percentage points with effect from 31 October 2024.

The surcharge applies to the full purchase price of the additional property, not only to portions above a threshold. A buyer purchasing a buy-to-let flat in Birmingham for £200,000 would therefore pay: 5% on the first £125,000 (0% standard plus 5% surcharge) and 7% on the next £75,000 (2% standard plus 5% surcharge), giving a total SDLT bill of £11,500.

There is an exception for buyers who are replacing their main residence. Where the previous main home is sold on the same day as the new purchase completes, or has been sold in the preceding 36 months, the surcharge does not apply. If the old home has not yet been sold on the day of completion, the buyer must pay the surcharge at completion. HMRC will refund the surcharge if the old home is sold within 36 months of the new purchase completing.

If you are considering a buy-to-let investment or purchasing a second home, our team working on commercial property matters in Solihull can help you understand how the surcharge affects the overall cost before you proceed.

Non-Resident Buyers and the Overseas Surcharge

A buyer who is not present in the United Kingdom for at least 183 days during the 12-month period before the purchase completes is treated as non-UK resident for SDLT purposes. Such a buyer pays an additional 2% surcharge on top of every applicable rate, including any additional dwellings surcharge.

This surcharge has not changed since it was introduced in 2021. A buyer who pays the 2% surcharge and later spends 183 or more days in the UK within the 12 months following the purchase date can apply to HMRC for a refund. Joint purchasers should note that the surcharge applies to the entire transaction if any one of the buyers is non-UK resident, with an exception for married couples and civil partners where one is UK-resident.

Changes Since 2022 and the Current Position

The original article published on this site in 2022 described rates introduced by the then-Chancellor's mini-budget. Those rates were themselves a temporary increase to SDLT thresholds, which were later extended by a further set of transitional measures. All of those temporary thresholds expired on 31 March 2025 and the pre-2022 structure returned on 1 April 2025.

Two further changes have since taken effect. The Higher Rates for Additional Dwellings surcharge rose from 3% to 5% on 31 October 2024 under the autumn Budget announced by Chancellor Rachel Reeves. Multiple Dwellings Relief, which had previously allowed buyers of two or more properties in a single transaction to calculate SDLT using an average price per dwelling rather than the full aggregate consideration, was abolished with effect from 1 June 2024 following the Spring Budget of that year. Transitional provisions preserved the relief for contracts exchanged on or before 6 March 2024, but no new claims are now available.

The practical effect of these combined changes is that buying property in England or Northern Ireland in 2026 carries a higher SDLT cost than at any point between 2022 and 2025, particularly for buyers of additional dwellings and first-time buyers purchasing above £300,000.

If you are buying or selling property in Scotland, the equivalent tax is Land and Buildings Transaction Tax, administered by Revenue Scotland. In Wales, Land Transaction Tax applies. The rates and thresholds in those jurisdictions differ from SDLT and should be checked separately with a solicitor qualified in the relevant jurisdiction.

Frequently Asked Questions

When is SDLT actually due?

SDLT must be paid and the return submitted to HMRC within 14 days of the completion date. In practice, your conveyancing solicitor will handle both the return and the payment on the day of completion, adding the amount to your completion statement. Penalties and interest accrue if the 14-day deadline is missed, so it is essential that the funds are available before completion takes place.

Can I get a refund if I overpay SDLT?

Yes, refunds are available in certain circumstances. If you paid the additional dwellings surcharge because you had not yet sold your previous main home, you can apply to HMRC for a refund provided you sell that previous home within 36 months of your new purchase completing. Refunds for non-resident buyers who subsequently satisfy the 183-day residence test are also available. You generally have 12 months from the filing date of your original SDLT return to amend it, and four years to make a separate claim for overpayment relief.

Does SDLT apply to shared ownership purchases?

Shared ownership purchases in England and Northern Ireland are subject to SDLT, but there are specific rules governing how it is calculated. A first-time buyer purchasing through shared ownership may elect to pay SDLT on the full market value of the property at the outset, which can be more tax-efficient where they intend to staircase to full ownership. Alternatively, SDLT can be paid only on the initial share purchased, with further payments due on each subsequent staircasing transaction once the cumulative ownership exceeds 80%. Taking advice before committing to a purchase structure is advisable.

Is SDLT payable on a property received as a gift?

A property transferred as a genuine gift, with no money changing hands and no mortgage or debt assumed by the recipient, does not attract SDLT. If, however, the recipient takes over an outstanding mortgage on the property, SDLT becomes payable on the value of the mortgage debt assumed. Where the property is transferred as part of a divorce or dissolution of civil partnership settlement, exemptions may apply, and specialist legal advice on the property aspects of separation can help structure the transfer correctly from both a tax and conveyancing perspective.

What is the position on linked transactions?

Linked transactions are two or more property transactions between the same buyer and seller, or between persons connected with them. HMRC can aggregate the consideration paid across linked transactions to determine the applicable SDLT rates, which can push the effective rate into a higher band. The rules on linked transactions remain in force despite the abolition of Multiple Dwellings Relief. Anyone entering into a series of property purchases with the same counterparty should take advice on whether the transactions will be treated as linked before exchange of contracts.

About the Author

Mark Stockton (SRA number 122231) is a Consultant Conveyancing Solicitor at Pearcelegal, advising on residential conveyancing and commercial property transactions across Solihull, Birmingham, Coventry, Sutton Coldfield and Warwick. Admitted in 1983, Mark ran his own firm, Anthony Stockton Solicitors, from 1999 until joining Pearcelegal in July 2020 to focus on client work. He is regulated by the Solicitors Regulation Authority (SRA ID 122231).