Take Jane’s situation. She had just bought her dream home, but the stamp duty bill took a serious chunk out of her savings. A few months later, she found out she was owed a stamp duty land tax refund and got the money back. Refunds also come into play where the SDLT was simply worked out wrong at the time of completion, for example where a higher rate surcharge was paid but the buyer later qualified to reclaim it. Plenty of buyers are in Jane’s position without knowing it. This post walks through how SDLT works in 2026, the current rates, the reliefs that still exist, and how the refund process actually runs.
- Know how Stamp Duty Land Tax works and which rates apply to your property type.
- Check whether you qualify for any reliefs, exemptions, or refunds before you file.
- Send your refund claim to HMRC with the right paperwork and inside the time limits.
Understanding Stamp Duty Land Tax (SDLT)
Stamp Duty Land Tax, sometimes called land transaction tax in general conversation, is the tax charged on property and land purchases in England and Northern Ireland. It falls on the buyer, not the seller, and it has to be paid on top of the purchase price.
Rates depend on whether you are buying a residential or non-residential property, what you pay for it, and your circumstances as a buyer.
Definition of Stamp Duty Land Tax
SDLT is a UK government tax on land and property transactions where the price is over the set threshold. It applies to both residential and non-residential purchases. SDLT is self-assessed, so the buyer is responsible for working out the correct amount and paying it to HMRC. Whether you are buying a first home, a buy-to-let, or a commercial unit, getting SDLT right matters because the penalties for getting it wrong are not small.
Purpose of Stamp Duty Land Tax
SDLT raises revenue for the UK government. The money collected from property purchases feeds into general public spending, including services and infrastructure. Most buyers in England and Northern Ireland will pay it at some point, since the thresholds are now lower than they were during the temporary higher bands that ran until April 2025.
SDLT for residential properties
For residential property, the rate you pay depends on the price and your status as a buyer. First-time buyers get their own relief, home movers pay the standard rates, and anyone buying an additional dwelling pays a surcharge on top.
Selling your previous main home matters too, because if you paid the higher rate surcharge on a new property and then sold your old one within 36 months, you can usually reclaim the surcharge.
The current nil-rate threshold for residential property is £125,000 (it dropped from £250,000 on 1 April 2025). On a £295,000 home bought as a main residence by someone who already owns property, the higher rate surcharge of 5% applies on top of the standard bands.
SDLT for non-residential properties
Non-residential covers commercial, industrial, agricultural, and mixed-use property (anything containing both residential and non-residential elements). The bands are different and start at £150,000. The top rate is 5% on the slice above £250,000. Bulk purchases of six or more dwellings can also be treated as non-residential, which is one of the few routes left for reducing the SDLT bill on a portfolio purchase.
The reliefs for residential property generally do not apply to non-residential transactions, so the rules need to be looked at separately.
Who is Liable for Stamp Duty?
Individuals buying residential property
Anyone buying a residential property in England or Northern Ireland is liable for SDLT, including first-time buyers, home movers, and buy-to-let investors. The figure depends on the price and your buyer status. First-time buyer relief still exists in 2026 but at lower thresholds than during the temporary period. Buyers of additional homes pay the higher rate surcharge.
Companies and partnerships buying property
Companies and partnerships pay SDLT too, on both residential and commercial purchases. The rules are not identical to those for individuals. Companies buying residential property worth more than £500,000 can be hit by the flat 17% rate under the higher threshold rules unless a relief applies, which makes professional advice worth the cost on these deals.
Non-UK residents buying property
Non-UK residents pay an extra 2% surcharge on residential property purchases on top of all other applicable rates. The test for non-resident status is based on UK presence in the 12 months before the transaction. If a non-resident buyer later spends 183 days or more in the UK during any continuous 365-day period that includes the day of the purchase, they can apply for a refund of the 2% surcharge.
Stamp Duty Rates and Calculations
How much SDLT you pay depends on the price of the property, what kind of buyer you are, and where you are tax resident. Budgeting for it properly is important, since SDLT cannot be added to the mortgage and has to come from your own funds at completion. There are three main groups of rates: standard rates for a single main residence, higher rates for additional dwellings, and non-residential rates for commercial or mixed property. Non-UK residents pay a further 2% on top.
Standard rates
Standard rates apply when you buy a single residential property as your main home. From 1 April 2025 the bands are 0% up to £125,000, 2% on the slice from £125,001 to £250,000, 5% on the slice from £250,001 to £925,000, 10% from £925,001 to £1.5 million, and 12% above £1.5 million. SDLT is calculated band by band, not as a flat percentage of the whole price.
Higher rates
If you already own a residential property anywhere in the world and you buy another one, the higher rate surcharge applies. It is currently 5% on top of every standard band (it was 3% before 31 October 2024). The surcharge applies to the full purchase price from the first pound, not just the slice above the main threshold. It does not apply if you are replacing your only or main residence.
Non-UK resident rates
Non-UK residents pay an extra 2% on top of whichever rates apply to their purchase. This applies to individuals and companies, and runs alongside the 5% higher rate surcharge if the buyer also already owns property elsewhere.
Stamp Duty Exemptions and Reliefs
Several reliefs and exemptions still exist in 2026. The most commonly used is first-time buyer relief. Multiple Dwellings Relief, which used to be a major route for buyers of large country properties with annexes, has been abolished and can no longer be claimed for transactions completing on or after 1 June 2024. Anyone considering a refund claim based on MDR should check the dates carefully before going any further.
First-time buyers relief
First-time buyers who are buying a property to live in as their main home can claim relief if the purchase price is £500,000 or less. Up to £300,000 the rate is 0%, and on the slice from £300,001 to £500,000 the rate is 5%. If the price is over £500,000 the relief is lost completely and the standard rates apply to the whole purchase price. The maximum saving is £10,000. To qualify, every buyer named on the transaction must be a first-time buyer worldwide, not just in the UK.
Multiple dwellings relief
Multiple Dwellings Relief was abolished from 1 June 2024. It can still be claimed where contracts were exchanged on or before 6 March 2024 and the contract has not been varied since, regardless of the completion date. For any deal that exchanged after 6 March 2024 and completed on or after 1 June 2024, MDR is no longer available. Anyone offered a “no win, no fee” SDLT refund based on an MDR claim should treat it with serious caution, because HMRC has been actively challenging late and questionable MDR claims.
Other reliefs and exemptions
Other reliefs include charity relief, group relief on transfers between companies in the same group, relief for property traders, and certain reliefs for builders buying back homes. Some of these are technical and the evidence requirements are strict. It is worth getting tax advice before relying on any of them, or checking the HMRC guidance on GOV.UK.
Paying and Filing SDLT
If SDLT is due on your purchase, the return must be filed and the tax paid within 14 days of the effective date of the transaction (usually completion). Most buyers leave this to their solicitor or conveyancer, who handles the SDLT return and the payment as part of the conveyancing process. You can also do it yourself through HMRC’s Stamp Taxes Online service, but you will need a Government Gateway user ID and password to access it.
How to file and pay
The return is filed online and the payment is made to HMRC at the same time. Where a solicitor or conveyancer is acting for you, they collect the SDLT from you on completion and submit everything on your behalf. Even where no tax is due (for example, where a relief reduces the bill to zero), a return still has to be filed unless the transaction is fully exempt.
Deadlines and penalties
Missing the 14-day deadline triggers an automatic late filing penalty, and interest runs on the unpaid tax from day one. Penalties increase the longer the return is late. Buyers should make sure their solicitor confirms the SDLT return has been filed and the payment cleared, since the buyer is the one responsible for it, not the solicitor.
Stamp Duty Refunds
There are several situations where a refund is possible. The most common is the higher rate surcharge refund, available where someone paid the 5% surcharge on a new main residence because they had not yet sold their old one, and then sold the old one within 36 months. Other refund routes include overpayments caused by errors in the original calculation, incorrect classification of a property as residential when it should have been mixed-use, and the non-UK resident surcharge refund where the buyer later meets the UK presence test.
Eligibility criteria
The main grounds for an SDLT refund in 2026 are these. First, the higher rate surcharge refund where you replaced your main residence within 36 months. Second, the non-UK resident surcharge refund where you spent at least 183 days in the UK in a continuous 365-day window starting up to one year before, or ending up to one year after, the transaction. Third, refunds for SDLT calculation errors, including incorrectly applied rates, missed reliefs, or wrong property classification. Mixed-use classification claims are heavily scrutinised by HMRC, so the supporting evidence has to be strong. If you are unsure, take advice before submitting a claim.
Refund process
A refund claim is made to HMRC, either online through the Government Gateway or by post using the relevant form. You need to include the original SDLT return details, the unique transaction reference number, evidence supporting the claim (such as the sale completion statement for the old property), and the bank details for the refund. The 36-month higher rate surcharge claim must be made within 12 months of the sale of the old main residence, or within 12 months of the filing date of the SDLT return on the new property, whichever is later. Other overpayment claims generally have to be made within four years of the effective date of the transaction.
Sending the claim in late means losing it, so the time limits matter as much as the eligibility itself.
In short, SDLT is not the easiest tax to get right, especially after the rate changes that took effect in April 2025 and the abolition of Multiple Dwellings Relief in June 2024. Knowing the current rates, knowing what reliefs are still available, and knowing the refund routes can be the difference between paying the right amount and overpaying by thousands. If your purchase had any unusual feature (an annexe, mixed-use land, a property that was uninhabitable on completion, a non-resident buyer, or a delayed sale of a previous home), it is worth having the SDLT return reviewed. Speaking to a qualified SDLT adviser or checking the official guidance on GOV.UK is the safest way to make sure your numbers are right.
Frequently Asked Questions:
How much is stamp duty land tax?
SDLT depends on the purchase price, the type of property, and the type of buyer. For standard residential purchases in 2026 it ranges from 0% on the first £125,000 up to 12% on the slice above £1.5 million. Additional property buyers pay 5% on top, and non-UK residents pay a further 2%.
What are the stamp duty rates for 2026?
The rates that apply in 2026 are the ones reintroduced on 1 April 2025. For main residences: 0% up to £125,000, 2% to £250,000, 5% to £925,000, 10% to £1.5 million, and 12% above. First-time buyer relief gives 0% up to £300,000 and 5% from £300,001 to £500,000, with no relief on prices above £500,000.
Can you claim back stamp duty land tax?
Yes, in several situations. The most common is the higher rate surcharge refund where you sold your previous main residence within 36 months of buying the new one. Refunds are also possible for overpaid tax due to calculation errors, the 2% non-UK resident surcharge if the buyer later meets the UK presence test, and certain other specific circumstances.
What is the current threshold for residential Stamp Duty Land Tax?
The standard nil-rate threshold for residential SDLT is £125,000 in 2026. Anything above that is taxed in bands. First-time buyers get a higher nil-rate threshold of £300,000, provided the property costs no more than £500,000.
How do I calculate the SDLT on a residential property purchase?
Work through the bands one at a time. Apply 0% to the part of the price up to £125,000, then 2% to the slice from £125,001 to £250,000, and so on up the bands. Add the higher rate surcharge of 5% on every band if you are buying an additional property, and add 2% on every band if you are a non-UK resident. The HMRC SDLT calculator on GOV.UK is the simplest way to double-check the figure.
