SDLT is the tax payable by buyers of residential and commercial property in England and Northern Ireland, calculated as a percentage of the purchase price on a tiered basis.
Stamp Duty Land Tax (SDLT) is a tax on property purchases in England and Northern Ireland. It replaced the old stamp duty in 2003 and is administered by HMRC. Scotland has its own Land and Buildings Transaction Tax (LBTT) and Wales has Land Transaction Tax (LTT).
For residential property, SDLT is calculated on a tiered basis: 0% on the first £125,000, 2% on £125,001 to £250,000, 5% on £250,001 to £925,000, 10% on £925,001 to £1.5 million, and 12% above £1.5 million. These thresholds are subject to change by government.
First-time buyers benefit from relief: they pay 0% on the first £425,000 and 5% on the portion from £425,001 to £625,000. The relief is withdrawn entirely if the purchase price exceeds £625,000.
Buyers of additional residential properties (second homes, buy-to-let) pay a 3% surcharge on top of the standard rates. Non-UK resident buyers pay a further 2% surcharge, meaning overseas investors in additional properties can face rates up to 17% on the top slice.
SDLT must be paid and a return filed within 14 days of completion. The solicitor handles this automatically, deducting the amount from the completion funds. Failure to file or pay on time results in automatic penalties and interest.
Within 14 days of completion. Your solicitor files the SDLT return and pays the tax using the funds you transfer to them as part of the completion monies.
The additional dwelling surcharge (3%) can be refunded if you sell your previous main residence within three years of buying the new one. Standard SDLT is generally not refundable.
If no money changes hands there is no SDLT. But if you take over a mortgage, SDLT is payable on the outstanding mortgage amount as chargeable consideration.
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