Stamp duty explained
Stamp duty is the tax that catches home-buyers by surprise — a bill for thousands, due on completion, on top of everything else. But it’s more logical than it looks, and there are big reliefs (especially for first-time buyers) that many people don’t realise apply to them. Here’s how it works in 2026.
This is information, not financial advice. This covers Stamp Duty Land Tax (SDLT) in England and Northern Ireland. Scotland (Land and Buildings Transaction Tax) and Wales (Land Transaction Tax) have their own systems and thresholds.
How stamp duty works: it’s tiered
The key thing to understand is that SDLT is tiered, like income tax — you pay each rate only on the portion of the price that falls in that band, not the whole price at one rate.
For a standard residential purchase (the rates since 1 April 2025):
| Portion of the price | Rate |
|---|---|
| Up to £125,000 | 0% |
| £125,001 – £250,000 | 2% |
| £250,001 – £925,000 | 5% |
| £925,001 – £1,500,000 | 10% |
| Above £1,500,000 | 12% |
Worked example — a £300,000 home: you pay 0% on the first £125,000, 2% on the next £125,000 (£2,500), and 5% on the final £50,000 (£2,500) — a total of £5,000. Not 5% of the whole £300,000.
Try your own price. Switch between moving home, first-time buyer and additional property to see the bill, band by band:
First-time buyer relief — often £0
If you’re a first-time buyer, the thresholds are much kinder. You pay:
- 0% up to £300,000
- 5% on the portion from £300,001 to £500,000
- and if the property costs more than £500,000, you get no relief and pay the standard rates above.
So a first-time buyer purchasing at or below £300,000 pays no stamp duty at all — and even up to £500,000 pays significantly less than a mover. To qualify, everyone buying must be a genuine first-time buyer.
The second-home surcharge: add 5%
If you’re buying an additional property — a second home or a buy-to-let, while keeping another — you pay a 5% surcharge on top of the standard rates in every band. On a £250,000 second home that’s an extra £12,500, so it’s a big number to plan for. (If you’re replacing your main home but there’s an overlap, you can often reclaim the surcharge later.)
When and how you pay
- Stamp duty is due on completion, and your conveyancer normally files the return and pays it for you from funds you provide — you don’t post a cheque to HMRC yourself.
- It must be paid within 14 days of completion.
- You can’t add it to your mortgage as such — you need the cash available, so budget for it alongside your deposit and fees.
The bottom line
Two things save people the most stress: work out the exact bill before you make an offer (the calculator above does it in seconds), and check whether first-time buyer relief applies — because for a lot of first purchases, the answer is a very welcome £0. And if you’re buying an additional property, plan for that 5% surcharge from the start.
Last checked 1 August 2026. SDLT rates for England & Northern Ireland as they stand since 1 April 2025. Scotland and Wales differ.
Sources
Just so you know: this guide is information and journalism, not financial advice, and we don't recommend specific financial products. Your circumstances are your own — if you need personal advice, speak to a suitably qualified adviser. Information was correct at the "last updated" date above but things change; always check the linked primary sources.