Stampy Duty Land Tax (SDLT) Q & A

Donna Buttolph

Written by Donna Buttolph, Conveyancing Executive at Spire Solicitors LLP

When buying a residential property, it is likely you will have to pay Stamp Duty Land Tax. SDLT is a Government tax payable on land transactions over £125,000. It applies when you buy a freehold property, buy a new or existing leasehold property, buy a shared ownership property or are transferring land or property in exchange for payment.

What are the current rates of SDLT?

There are several rate bands for Stamp Duty Land Tax which are as follows:

– up to £125,000 the SDLT  rate is 0%

– £125,001 to £250,000 the SDLT rate is 2%

– £250,001 to £925,000 the SDLT rate is 5%

– £925,001 to £1,500,000 the SDLT rate is 8%

– over £1,500,000 the SDLT rate is 12%

SDLT is calculated on each part of the purchase price which falls within the above band.

I am a first time buyer, how does SDLT apply?

If the purchase price of your property is less than £300,000 and you and anyone else buying with you has never owned or had an interest in a property, there will be no SDLT payable.

If the property price is between £300,000 – £500,000 then SDLT is calculated on that part only at 5%. If the price is over £500,000 then normal rates of stamp duty apply to the full price, and no relief is given.

What is the 3% surcharge introduced by the Government?

The 3% surcharge was introduced on 1st April 2016 and affects anyone who is buying an additional residential property for £40,000 or more. This could mean a holiday home, buy-to-let or even a main residence you plan to live in.

I am selling and buying a property at the same time.  Will the 3% higher rate of SDLT apply?

If you complete on your sale and purchase on the same day you will not have to pay the additional SDLT. However if there is a delay with the property you are selling and you complete on your purchase first, you will have to pay the higher rate because you own two properties. If you sell your previous property within 36 months of completing on your new main residence, you may be able to get a refund.

I own a property with my husband, which we live in as our main residence. My husband is planning on purchasing a buy-to-let property in his own name. As we will only own one property each, does the higher rate of SDLT still apply?

The higher rates will apply to the purchase of the property.  As a married couple all property owned by either of you is treated as owned jointly.  The purchase of the flat will therefore be classed as an additional residential property for both of you.

If you would like to receive our free guide to purchasing a property please email