Stamp Duty on Residential Properties

You must pay Stamp Duty Land Tax (SDLT) on any residential property where the purchase price is over £125,000, unless you are a first time buyer.

You can use our Stamp Duty Calculator to find out how much tax you will have to pay.

Current Stamp Duty Rates

Example

If you buy a property for £280,000, the SDLT you owe is calculated as follows:

0% on the first £125,000 = £0
2% on the next £125,000 = £2,500
5% on the final £30,000 = £1,500
Total SDLT = £4,000

From April 1st 2016, if you are purchasing a property that you will be renting out, often known as a 'Buy to Let' property, Stamp Duty will be calculated at 3% over the standard rates. This rate will also apply to the purchase of 'second homes', and any purchase where an individual owns two or more properties at the end of the transaction and has not replaced their main residence. Read our additional residential property Stamp Duty guide for more information.

Stamp Duty is also payable when you purchase the freehold (buying the existing ‘assigned’ lease) for a property from your landlord, and is calculated on the same scale as for a property purchase. The purchase price of the lease is known as the ‘lease premium'.

Similarly, if you purchase a new residential leasehold property you will also pay the lease premium, but in addition if the total rent over the life of the lease (known as the ‘net present value’) is more than £125,000, you will also pay additional Stamp Duty of 1% on the amount over £125,000.

Special Rates

There are different Stamp Duty rates, rules and calculations for:

• commercial properties
• corporate bodies
• people buying 6 or more residential properties in one transaction
• shared ownership properties
• multiple purchases or transfers between the same buyer and seller (also know as linked purchases)

Further details can be found in the Stamp Duty Land Tax section of the gov.uk website.