Stamp Duty in 2026: Bands, First-Time Buyers and Second Homes
Stamp Duty Land Tax (SDLT) is one of the biggest single costs of buying property in England and Northern Ireland — and one of the most misunderstood. The bands and reliefs change frequently, the rules around second homes and overseas buyers add layers of complexity, and small structural decisions about how a property is purchased can change the bill by thousands. This guide walks through the 2026 position in plain English so you know what to budget and what to question.
The current SDLT bands
Following the reversal of the temporary nil-rate uplift in April 2025, standard SDLT in England and Northern Ireland kicks in from £125,000. The bands are 0 percent up to £125,000, 2 percent from £125,001 to £250,000, 5 percent from £250,001 to £925,000, 10 percent from £925,001 to £1.5m and 12 percent above £1.5m.
SDLT is calculated like income tax — only the slice of the price falling in each band is taxed at that rate. So a £400,000 home pays nothing on the first £125,000, then 2 percent on the next £125,000, then 5 percent on the remaining £150,000.
First-time buyer relief
First-time buyers in England and Northern Ireland pay no SDLT on the first £300,000 of a property up to £500,000. Above £500,000 the relief is lost entirely and standard rates apply. Both purchasers on a joint application must be first-time buyers — anyone who has ever owned property anywhere in the world, including inherited shares, is disqualified.
Scotland uses a separate Land and Buildings Transaction Tax (LBTT) and Wales uses Land Transaction Tax (LTT) with their own bands and first-time buyer reliefs. Always check the regime for the country the property is in, not where you live.
Second homes and additional property surcharge
The 5 percent additional property surcharge applies to anyone buying a second home, buy-to-let or any property when they already own one — globally, not just in the UK. The surcharge is on top of standard SDLT, so a buy-to-let at £300,000 pays both the standard banded amount and 5 percent on the full price.
If you are replacing your main residence but the sale completes after the purchase, the surcharge is paid up front and reclaimed within 3 years if the previous main home is sold within 36 months of the new purchase. Plan completion dates carefully because the cashflow impact is significant.
Non-resident surcharge and corporate buyers
Buyers who are non-resident in the UK in the 12 months before completion pay an additional 2 percent on top of all other rates. This applies to individuals, trusts and companies. For overseas buyers of investment property in London and the South East this can push effective top rates above 19 percent on the upper bands.
Companies and other 'non-natural persons' buying residential property over £500,000 face a flat 17 percent SDLT charge unless a specific relief applies (for example genuine letting businesses). Anyone considering a corporate purchase should take specialist tax advice — this is an area HMRC scrutinises closely.
Reliefs, mixed-use and reclaim opportunities
Multiple Dwellings Relief was abolished in 2024, so the old trick of buying two flats together to average down SDLT is gone. Genuinely mixed-use property (e.g. a flat above a shop) is taxed at non-residential SDLT rates, which top out at 5 percent — but HMRC has tightened its definition and now challenges many borderline mixed-use claims.
If you've paid SDLT on derelict or uninhabitable property at residential rates, there may be grounds to reclaim and pay non-residential rates instead. Use a chartered tax adviser, not a no-win-no-fee SDLT reclaim mill — many of those firms have been shut down by HMRC for spurious claims that taxpayers were left to repay.
Frequently asked questions
When is SDLT due?
Within 14 days of completion. Your conveyancer typically handles the return and payment as part of the closing process.
Do I pay SDLT if I am gifted a house?
Generally no SDLT applies to a pure gift with no mortgage transferred. If a mortgage is transferred, SDLT may apply on the value of the debt assumed.
Can I add SDLT to my mortgage?
Not directly, because it must be paid in cash at completion. Some buyers borrow more and complete with a larger cash buffer to cover SDLT, fees and moving costs.