What Is Stamp Duty?
Stamp Duty, also known as Stamp Duty Land Tax or SDLT, is a type of property tax you'll generally need to pay in the UK when you purchase a residential property or land. Stamp Duty applies to properties in England and Northern Ireland over a certain value, while in Wales and Scotland, slightly different schemes apply, although they operate in a similar way.
The amount of Stamp Duty you’ll need to pay depends on the type of buyer you are, such as a landlord or first-time buyer, and the value and purpose of the property you’re buying.
The Topics Covered in this Article Are Listed Below:
What Are the Stamp Duty Rates On Buy-to-Let Properties and Second Homes?
The Stamp Duty on second homes or buy-to-let properties is a 3% additional surcharge paid on top of the standard Stamp Duty you would normally pay on a property that is your main residence.
Buy-to-Let Stamp Duty Rates
|Property Value||Standard SDLT Rate 23/09/22 - 31/03/25||SDLT Rate on Second Homes or Buy-to-Lets 23/09/22 - 31/03/25|
|Up to £250,000||0%||3%|
|£250,001 - £925,000||5%||8%|
|£925,001 - £1,500,000||10%||13%|
For example, for a property valued at £260,000, the total Stamp Duty payable is 3% on the amount up to £250,000 and 8% on the £10,000 above £250,000.
How Does the Buy-to-Let Stamp Duty Calculator Work?
The buy-to-let and second home Stamp Duty calculator works out the normal rate of Stamp Duty that would apply, plus the 3% surcharge payable on buy-to-let or second homes, based on the property's value.
How Much Stamp Duty Do You Pay on a Buy-to-Let Property?
Our buy-to-let (BTL) Stamp Duty calculator for rental properties and second homes will tell you how much Stamp Duty you need to pay when purchasing a buy-to-let property or second home.
In accordance with new rates introduced in 2016, people who own more than one property must pay 3% on top of the normal Stamp Duty rates.
For more information, take a look at our second home Stamp Duty guide.
Enter the purchase price and press the Calculate button.
Once you've calculated how much Stamp Duty you'll pay on your buy-to-let property, you can speak to a mortgage expert to assess your options, or try one of our other mortgage calculators to estimate things like rental income or how much you can borrow on a mortgage for buy-to-let.
Buy-to-Let Stamp Duty Exemptions
If you purchase a main residence above a certain value – currently £250,000 – you'll have to pay normal Stamp Duty. If you purchase a buy-to-let or second home, you’ll have to pay normal Stamp Duty plus the surcharge across the total value of the property but at different rates.
Some exemptions for Stamp Duty are as follows:
- You’re a first-time buyer and purchase a property as your main home up to £425,000
- You receive property as a bequest. You won’t pay Stamp Duty as you’ll pay Inheritance Tax instead
- You receive property or land as payment or for a reason stipulated by HMRC, such as a divorce settlement
There are also various situations where you may be granted Stamp Duty relief, such as if you’re a registered social landlord and buy property in certain circumstances, you’re a registered charity and purchase property for charitable use, or you’re an employer who buys an employee’s home because they’re relocating for work reasons.
Buy-to-Let and Second Home Stamp Duty FAQs
When Do I Have to Pay Buy-to-Let Stamp Duty?
Buy-to-let or second-home Stamp Duty is payable when you purchase your property. You’re required to send your Stamp Duty return and pay the applicable tax within 14 days of completing the purchase.
Normally, your solicitor will file your Stamp Duty return and pay the bill for you, and simply add the cost to your solicitor's fees. If your solicitor isn’t able to do this, you can file and pay your Stamp Duty tax online yourself. Use our buy-to-let stamp duty calculator above to work out how much you’ll owe.
What Counts as a Main Residence for Stamp Duty Purposes?
For your property to count as your main residence, it must be bought with the intention of using it as your main home. If you're already a homeowner, your previous main residence should be sold or remortgaged at the time of purchasing the new one. If you still own your previous home as a second or rental property, you’ll be liable for the surcharge for Stamp Duty on second homes. Fortunately, you'll be able to claim this back as long as you sell the original property within 3 years and don’t rent it out in the meantime..
It’s important to note that residency is based on where you live, rather than simply where you’re registered to vote. HMRC will look at several factors, including where you work or where your children go to school.
I Want to Buy a Property in My Name but Live with My Partner in a House They Own. Will I Have to Pay the Extra Stamp Duty Charge?
No, you won’t have to pay a second home Stamp Duty surcharge as long as you’re not in a marriage or civil partnership and/or on the title deeds of your partner’s property. You’ll be treated as an individual and can buy a property at the standard Stamp Duty rate solely in your own name.
If you’re married or in a civil partnership, you'll be seen as joint property owners in terms of Stamp Duty and be liable to pay the surcharge for Stamp Duty on second homes. You can check how much that’s likely to be using a buy-to-let and second-home Stamp Duty calculator.
I’m Purchasing a House in England but Already Own a Home Abroad. Will I Have to Pay the Extra Stamp Duty Charge?
You won’t have to pay the extra Stamp Duty charge if you’re going to sell your home abroad when you buy your new house in England as this new house would be your new main residence. If you intend on retaining the home abroad, you will have to pay the extra Stamp Duty on the England property as it will technically be a second home.
I’m Helping My Child Buy a House and Already Own My Own Home. Will I Need to Pay the Additional Stamp Duty Charge?
If you’re helping your child buy a property, it’ll very much depend on the circumstances as to whether you pay the second home Stamp Duty surcharge.
If you’re purchasing the property as joint owners and your name will be on the deeds, it will technically count as your second property and all owners will be liable for the 3% surcharge. It doesn’t matter that your child may be a first-time buyer; they’ll still be liable for the additional Stamp Duty when buying a property with a parent that already owns a home.
One way to ensure your child benefits from the first-time buyer Stamp Duty exemption or simply avoids paying additional Stamp Duty (if they’ve owned a property previously), is to take out a joint borrower sole proprietor mortgage. This is where both of you can be borrowers on the mortgage, but only one of you (the child) is on the title deeds of the property.
Estimate how much you’ll need to pay overall with our buy-to-let and second-home Stamp Duty calculator.
If you’re acting as guarantor or gifting some money to your child for a deposit, you also won’t have to pay additional Stamp Duty.
Are Stamp Duty Rates the Same Across the UK?
The rate of Stamp Duty you pay differs depending on the location of the property that you’re purchasing.
In England and Northern Ireland, the standard Stamp Duty tax rates are as follows:
- Up to £250,000 = 0%
- £250,001 to £925,000 = 5%
- £925,001 to £1,500,000 = 10%
- Over £1,500,000 = 12%
In Scotland, the equivalent standard Land and Buildings Transaction Tax rates are as follows:
- Up to £145,000 = 0%
- £145,001 to £250,000 = 2%
- £250,001 to £325,000 = 5%
- £325,001 to £750,000 = 10%
- Over £750,000 = 12%
In Wales, the equivalent standard Land Transaction Tax rates are as follows:
- Up to £225,000 = 0%
- £225,000 to £400,000 = 6%
- £400,001 to £750,000 = 7.5%
- £750,001 to £1,500,000 = 10%
- Over £1,500,000 = 12%
How Do I Pay Buy-to-Let Stamp Duty?
You have 2 options for paying Stamp Duty. The most common way to pay your Stamp Duty is through your solicitor or conveyancer. Normally, they’ll file your return and pay your Stamp Duty for you, including any second home or buy-to-let surcharges- some will add the cost to their fees.
If your solicitor or conveyancer can’t do it, or you’d rather do it yourself, you can. You can use a buy-to-let stamp duty calculator to work out how much you owe, and file and pay your Stamp Duty online within the given timeframe.
Do I Have to Pay Stamp Duty on a Property I’ve Inherited and Want to Rent Out?
Inherited properties aren’t subject to the Stamp Duty surcharge and will usually be subject to Inheritance Tax instead. If, however, you inherit a property and purchase another one before you sell it, you’ll have to pay standard Stamp Duty plus the second home surcharge.
You can now get a buy-to-let mortgage at interest rates to suit almost any circumstances. Our guide takes you through the choices involved in more detail.
Stamp Duty Tax Guide
Here you’ll find everything you need to know about Stamp Duty: what it is, who pays it, exemptions and relief, the rates at which you pay it and more.
On this page you’ll find our detailed mortgage terminology glossary. There’s a lot of jargon out there but we’re here to make it easy.