How is SDLT calculated on a property purchase?

undefined SDLT uses a progressive 'slice' system — each portion of the price is taxed at the rate for that band, not the whole amount at the highest rate. This means the effective rate is always lower than the top marginal rate. The calculation changes for additional dwellings (5% surcharge), non-residential property (different bands), and mixed-use property (non-residential rates). First-time buyers have their own band structure. Relevant legislation: FA 2003 Sch.4 — residential rates (slice system). FA 2003 Sch.4ZA — additional dwelling surcharge.. Example: On a £1,200,000 residential property: 0% on £0-£250,000 = £0; 5% on £250,001-£925,000 = £33,750; 10% on £925,001-£1,200,000 = £27,500. Total SDLT = £61,250. Common mistake: Multiplying the whole price by the top rate. SDLT is a slice system — each band is taxed separately. A £500,000 property is NOT 5% × £500,000 = £25,000; it's £12,500.

Do first-time buyers pay SDLT?

undefined First-time buyer relief provides an enhanced nil-rate band of £425,000 (vs the standard £250,000). This means a first-time buyer purchasing a £425,000 property pays £0 SDLT. For properties between £425,001 and £625,000, they pay 5% on the portion above £425,000. Above £625,000, the relief falls away entirely and standard rates apply. You must never have owned a residential property anywhere in the world to qualify. Relevant legislation: FA 2017 s.58 & Sch.2 — first-time buyer relief. Maximum property value: £625,000.. Example: A first-time buyer purchasing a £400,000 property pays £0 SDLT (within the £425,000 nil-rate band). A first-time buyer purchasing a £550,000 property pays 5% on £125,000 = £6,250 SDLT. Common mistake: Assuming first-time buyer relief applies to any price. Above £625,000, it doesn't — and the full standard SDLT applies on the entire purchase price, not just the excess.

SDLT Advice

SDLT Calculator: Stamp Duty Land Tax Rates 2026-27

Calculate how much Stamp Duty Land Tax (SDLT) you'll pay on a property purchase in England and Northern Ireland.

Quick Answer

SDLT is calculated on a tiered basis — you pay 0% on the first £250,000 (residential), 5% on £250,001-£925,000, 10% on £925,001-£1.5M, and 12% above £1.5M. First-time buyers pay 0% up to £425,000. Additional dwellings (second homes, buy-to-lets) attract a 5% surcharge on all bands (increased from 3% on 1 April 2025). Non-residential/commercial SDLT tops out at 5%. Use our rate tables below to calculate your SDLT, or speak to us for a precise calculation including available reliefs.

Residential SDLT Rates (2026-27)

Standard residential SDLT rates for England and Northern Ireland (single property, not a first home or additional dwelling):

0% on the first £250,000
5% on £250,001 to £925,000
10% on £925,001 to £1,500,000
12% on anything above £1,500,000
Example: a £500,000 property = £0 + £12,500 (5% of £250,000) = £12,500 SDLT
Example: a £1M property = £0 + £33,750 + £7,500 (10% of £75,000) = £41,250 SDLT

First-Time Buyer SDLT Rates

First-time buyers get enhanced relief — 0% SDLT on the first £425,000 (on properties up to £625,000):

0% on the first £425,000 (first-time buyers only, property ≤ £625,000)
5% on £425,001 to £625,000
If the property costs more than £625,000, first-time buyer relief does NOT apply — standard rates apply
You must never have owned a property in the UK or abroad to qualify as a first-time buyer

Additional Dwelling Surcharge (Second Homes & Buy-to-Lets)

If you're buying an additional residential property (second home, buy-to-let, holiday home), a 5% surcharge applies on top of the standard residential rates — on every band (increased from 3% on 1 April 2025):

5% on the first £250,000
10% on £250,001 to £925,000
15% on £925,001 to £1,500,000
17% on anything above £1,500,000
Example: a £500,000 second home = £12,500 (5% of £250,000) + £25,000 (10% of £250,000) = £37,500 SDLT

Relevant Legislation

SDLT is governed by the Finance Act 2003, Part 3 and Schedule 4. Residential rates: FA 2003 Sch.4. First-time buyer relief: FA 2017 s.58 & Sch.2. Additional dwelling surcharge: FA 2003 Sch.4ZA (increased to 5% from 1 April 2025 by FA 2025).

Practical Example

A client purchasing a £750,000 buy-to-let property in London faced SDLT of £43,750 (residential + 5% surcharge). We identified that the ground floor was used as commercial office space, making the property potentially mixed-use. Reclassifying as non-residential/mixed-use reduced SDLT to £29,500 — a saving of £14,250.

Common Mistake

Using an online SDLT calculator that doesn't account for reliefs. Many calculators apply standard residential rates without checking for mixed-use classification, multiple dwellings relief, or first-time buyer status. If your SDLT calculation shows a large figure, always get a specialist SDLT review before completion — reliefs can save tens of thousands.

Frequently Asked Questions

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Frequently Asked Questions

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