What is Stamp Duty Land Tax and how is this charged

On completion of a purchase, we are required to register the transaction (and any mortgage) with the Land Registry. As part of this process, we submit appropriate evidence to the Land Registry that all applicable Stamp Duty Land Tax (SDLT) has been paid.

SDLT is a self-assessment tax and so as a Buyer it is your responsibility to personally certify that proper assessment has been made and the correct duty paid.

As Property Lawyers, we are not tax advisors or specialists and, although we would assist and complete the SDLT Land Transaction Return, we do so based on the information that you provide to us.

SDLT is charged in various ways and there may be reliefs available to you, or higher rates applicable, depending on your circumstances.

This is a short guide with some popular circumstances.

1. Standard SDLT – Not a First Time Buyer

From -, 1^st April 2025 Buyers will pay based on the following: -

• Purchase is only of a single dwelling and the purchase is replacing a main residence or your only residence, but you are not a first time buyer. 

2. First Time Buyers Relief

From -, 1^st April 2025 First Time Buyers will be exempt from Stamp Duty on properties up to £300,000 and pay 5% on the portion between £300,001 and £500,000. If the property price is over £500,000 you cannot claim this relief.

• Purchase is only of a single dwelling to be occupied by you as your main residence
• None of the purchasers have previously had an interest in a dwelling, anywhere in the world. (Interest in a dwelling includes a property that you have inherited or are a beneficiary of a trust that owns a property).

https://www.gov.uk/stamp-duty-land-tax/residential-property-rates

3. Higher Rates for Multiple Properties

If after completion, you or your spouse or civil partner, will have an interest in more than one dwelling (including holiday homes, inherited properties, or discretionary trust), anywhere in the world, then you will be liable to pay a higher rate of SDLT. This means that you will have to pay 5% on top of SDLT rates when buying  a new residential property which results in you owning or having an interest in more than one.

There is an exemption if you are replacing your main residence, i.e. if you are moving house, even if there is a gap between the sale and the purchase. In some cases, you may have to pay the higher rate and then claim a refund afterwards. Please visit the link below for further information.

https://www.gov.uk/stamp-duty-land-tax/residential-property-rates

4. Stamp duty land tax for non-UK residents

Different rates of SDLT apply to purchasers of property who are not resident in the UK. This is if you are not present in the UK for at least 183 days during the 12 months before completion of your purchase. The rates are 2% higher than those that apply to UK residents. This applies to all residential properties as well as increasing the SDLT payable on rents on the grant of a new lease.

• 2% surcharge also applies to certain UK resident companies that are controlled by non-UK residents.
• The 2% surcharge applies even only one member of a joint purchase is non-resident

In the following property transactions/circumstances, we would advise you seek specific advice on how SDLT should be paid: -

• Multiple properties. This also applies to annexes or additional buildings on the land and property. (You may be able to claim multiple dwelling relief)
• Any non-domestic elements such as an office or any actively farmed land.
• A company or trust.
• An inter-spouse transfer or if in relation to a divorce.
• You are a non-UK resident.