Stamp Duty Land Tax (SDLT)

Q: What happens if I miss the Self Assessment deadline?

The Self Assessment deadline is 31 January (online filing) for the previous tax year. Miss it and HMRC apply an automatic £100 penalty. Beyond that: £10 per day from 3 months late (capped at £900), 5% of tax due at 6 months late, and another 5% at 12 months late, under Schedule 55 of the Taxes Management Act 1970. If you have a genuine reason (serious illness, bereavement, technical issue with HMRC's systems) you can appeal with evidence; HMRC accepts reasonable excuse appeals in most genuine cases.

Q: Do I need an accountant or can I file Self Assessment myself?

Legally you can file Self Assessment yourself via gov.uk for free, most simple sole-trader returns (single income source, basic expenses) are realistic to self-file. An accountant adds real value when: your trading profit is above £40,000 (extraction-strategy decisions matter), you have multiple income streams (PAYE + self-employment + property + dividends), you've crossed the £90,000 VAT threshold, you're considering incorporation, or you have an HMRC enquiry. Expect to pay £400-£1,500/year for a typical sole-trader accountant; the cost is itself a deductible expense.

Q: How do payments on account work?

When your Self Assessment tax bill exceeds £1,000 for the first time, HMRC requires payments on account toward NEXT year's tax. Half the current bill is due 31 January (alongside the current bill); the other half is due 31 July. So your first January after crossing the threshold can hit with a double-bill: last year's balance + first payment on account. Adjust via Form SA303 if you expect next year's income to drop substantially. Payments on account don't apply if more than 80% of your tax is collected via PAYE.

Q: I'm buying a £600,000 main residence in 2025/26, what's my SDLT bill?

**Standard rates from 1 April 2025**: 0% × £125,000 = £0; 2% × £125,000 (£125k-£250k slice) = £2,500; 5% × £350,000 (£250k-£600k slice) = £17,500. **Total SDLT: £20,000.** Compared to pre-April-2025 rates (£250,000 nil-rate threshold): 0% × £250,000 + 5% × £350,000 = £17,500 → £2,500 more SDLT after the reform. The threshold reversion bites particularly on lower-value purchases where the £125,000 vs £250,000 difference is a larger proportion of total cost.

Q: First-time buyer purchasing £450,000 home, how much SDLT under new rules?

**From 1 April 2025**: 0% up to £300,000; 5% on £300,001-£500,000. £450,000 - £300,000 = £150,000 at 5% = **£7,500 SDLT**. Pre-April 2025 (under old FTB relief £425,000 threshold): 0% up to £425,000; 5% on £425,000-£500,000. £450,000 - £425,000 = £25,000 at 5% = £1,250. **Cost increase from FTB reform: £6,250 on a £450,000 first-time purchase.** FTB relief is also no longer available at all for properties >£500,000 (down from £625,000), first-time buyers in higher-value markets (London, South East) lose the relief entirely under new thresholds.

Stamp Duty Land Tax (SDLT) is the UK property purchase tax for residential property in **England + Northern Ireland** (Scotland uses Land + Buildings Transaction Tax LBTT, devolved; Wales uses Land Transaction Tax LTT, devolved). **Standard Residential Rates from 1 April 2025**: 0% up to £125,000 (REVERTED from £250,000); 2% £125,001-£250,000; 5% £250,001-£925,000; 10% £925,001-£1,500,000; 12% above £1,500,000. **First-Time Buyer Relief from 1 April 2025**: 0% up to £300,000 (REDUCED from £425,000); 5% £300,001-£500,000; NO RELIEF if property exceeds £500,000 (max eligible property reduced from £625,000). **HRAD Surcharge from 31 October 2024**: 5% (increased from 3%) on top of standard rates for additional dwellings (second homes, buy-to-lets) + ALL company residential purchases. **Companies purchasing residential >£500,000**: flat 17% (increased from 15% on 31 October 2024). The 1 April 2025 reforms returned thresholds to pre-September-2022 levels, meaningful cost increases for buyers across all price points.

Last reviewed: 23 May 2026

Guidance, not advice. We explain the rules, we don't assess your situation. Always seek financial or tax advice from your accountant, or contact HMRC. Read our editorial scope →

What this relief is, in plain English

SDLT is the headline-impact tax on UK residential property purchases. The April 2025 reforms returned thresholds to pre-September-2022 levels, a meaningful cost increase for buyers across all price points. The October 2024 HRAD surcharge increase from 3% to 5% raised the cost of buy-to-let + additional-property purchases substantially. Combined, the two reforms represent the most significant SDLT cost increase in a decade. Standard residential rates (from 1 April 2025): 0% up to £125,000 (reverted from £250,000); 2% £125,001-£250,000; 5% £250,001-£925,000; 10% £925,001-£1,500,000; 12% above £1,500,000. Calculated SLICE by SLICE, each portion of the price faces its applicable rate. First-time buyer relief (from 1 April 2025): 0% up to £300,000 (down from £425,000); 5% £300,001-£500,000; NO RELIEF for properties above £500,000 (down from £625,000). Eligibility: must be first-time buyer of a residential property to use as main residence; cannot have previously owned residential property anywhere in the world; spouse/partner buying together must both be first-time buyers. HRAD surcharge (5% from 31 October 2024): additional 5% on top of standard rates for additional dwellings, second homes, buy-to-lets, and ALL company residential purchases. Genuine main-residence replacement (selling old main + buying new) is exempt from HRAD; refunds available if not selling immediately + later complete within 3 years. Companies purchasing residential >£500,000: flat 17% rate (raised from 15%) replaces the standard slice mechanic at high values. Devolved equivalents: Scotland LBTT (different rates + thresholds); Wales LTT (different rates + thresholds). Same property in different UK jurisdictions can have materially different purchase taxes.

How it works

Standard residential rate bands (from 1 April 2025)

0% up to £125,000; 2% £125,001-£250,000; 5% £250,001-£925,000; 10% £925,001-£1,500,000; 12% above £1,500,000. Slice mechanic: each portion of price taxed at its band's rate, not whole price at top band. Calculator available at gov.uk/stamp-duty-land-tax/residential-property-rates.

First-time buyer relief (from 1 April 2025)

0% up to £300,000; 5% £300,001-£500,000; NO RELIEF for property >£500,000 (down from £625,000). Eligibility: never owned residential property anywhere in world; buying as main residence; if buying jointly, ALL purchasers must be FTBs. Generous below £500,000; cliff-edge loss of relief above.

HRAD surcharge, 5% from 31 October 2024

5% (up from 3%) ON TOP of standard rates for additional dwellings, second homes, BTLs, all company residential purchases. EXEMPTIONS: replacing main residence (selling old + buying new); inherited 50%+ interest properties; certain trustee structures. Refund available if buying new main residence before selling old, then selling within 3 years.

Companies purchasing residential >£500,000, flat 17%

Above £500,000, companies (not individuals) pay flat 17% (raised from 15% on 31 October 2024). Designed to discourage corporate ownership of high-value residential property, combined with annual ATED charge. Below £500,000: companies use standard rates + 5% HRAD surcharge. ATED also applies annually + adds material ongoing cost.

Who qualifies

Purchasing residential property in England OR Northern Ireland (Scotland LBTT / Wales LTT separate)
Standard rates apply to all purchasers unless first-time buyer relief or HRAD surcharge applicable
First-time buyer relief: never owned residential property anywhere globally; buying as main residence; joint purchasers all must be FTBs
HRAD surcharge applies to additional dwellings + all company residential purchases (with main-residence-replacement exemption)
Company purchase >£500,000 residential: flat 17% rate (replacing standard mechanic)

Interactions with other reliefs

60-Day CGT Reporting (on disposal)

SDLT applies at PURCHASE; 60-day CGT reporting + Annual CGT apply at DISPOSAL. SDLT paid at purchase is part of the property's cost basis for eventual CGT calculation (reduces gain on sale).

Section 24 + Ltd Co Buy-to-Let

Higher SDLT on Ltd Co residential (HRAD 5% + 17% flat above £500k) is the deliberate counterweight to Ltd Co landlord exemption from Section 24 mortgage interest restriction. Trade-off: pay more SDLT upfront; deduct mortgage interest fully ongoing.

ATED (Annual Tax on Enveloped Dwellings)

ATED applies ANNUALLY to company-owned residential property valued over £500,000. Additional ongoing cost on top of SDLT 17%. Major disincentive for company ownership of high-value residential. Some commercial-let exemptions apply.

FHL Abolition (April 2025)

Former FHLs now treated as ordinary residential rental property. SDLT was paid on acquisition under the residential mechanic; no SDLT consequence of FHL abolition itself. Section 24 + HRAD-on-resale mechanics now apply going forward.

Common mistakes + audit triggers

Using pre-April 2025 thresholds (nil-rate £125k now, not £250k; FTB £300k now, not £425k)
Using pre-October 2024 HRAD rate of 3% (now 5%)
Companies forgetting the 17% flat rate above £500k (replaces standard mechanic)
Joint FTB purchasers where one partner has previously owned property (entire purchase loses FTB relief)
Not claiming HRAD refund when replacing main residence + selling old within 3 years
Treating Scotland / Wales transactions as SDLT (use LBTT / LTT instead, different rates + thresholds)
Forgetting ATED ongoing charge on company-owned residential >£500k

Worked example

Carmen + Joaquin, Reading - First-time buyer couple purchasing £475,000 main residence in 2025/26 (2025/26)

Carmen + Joaquin, both first-time buyers (neither has ever owned residential property anywhere), purchasing £475,000 main residence in Reading. Completion June 2025 (post-April 2025 SDLT reform).

Calculation: **Eligibility: both FTBs + buying as main residence + property < £500,000 → FTB relief applies.** FTB relief band structure (from 1 April 2025): - 0% on first £300,000 = £0 - 5% on £300,001-£475,000 = 5% × £175,000 = £8,750 - **Total SDLT: £8,750** **Comparison to alternative scenarios:** **A) Standard rates (if not FTB-eligible):** - 0% × £125,000 = £0 - 2% × £125,000 = £2,500 - 5% × £225,000 (£250k-£475k) = £11,250 - Total: £13,750 (£5,000 more than with FTB relief) **B) FTB relief under pre-April-2025 rules (£425k threshold):** - 0% × £425,000 = £0 - 5% × £50,000 (£425k-£475k) = £2,500 - Pre-reform total: £2,500 - **Cost of April 2025 reform: £8,750 - £2,500 = £6,250 ADDITIONAL** for this exact FTB scenario. **C) Property at £510,000 (above FTB max):** No FTB relief at all → standard rates: £15,500 SDLT. Carmen + Joaquin lose £15,500 - £8,750 = £6,750 FTB advantage if they stretch to £510,000. **Strategic note:** April 2025 SDLT reforms shifted FTB market dynamics significantly. The £500,000 ceiling on FTB relief (down from £625,000) creates a hard cliff in higher-priced markets (London, South East). Joint FTB purchasers must coordinate carefully, if one partner has previously owned property, the entire purchase loses FTB relief. The standard rate threshold reversion (£125k from £250k) raises costs across the market regardless of FTB status.

Statute reference: Finance Act 2003 + subsequent amending Acts + 2024 + 2025 Budgets FA 2003 Part 4 + amending provisions. HMRC manual: SDLTM00000 onwards.

Frequently asked questions

What happens if I miss the Self Assessment deadline?+

The Self Assessment deadline is 31 January (online filing) for the previous tax year. Miss it and HMRC apply an automatic £100 penalty. Beyond that: £10 per day from 3 months late (capped at £900), 5% of tax due at 6 months late, and another 5% at 12 months late, under Schedule 55 of the Taxes Management Act 1970. If you have a genuine reason (serious illness, bereavement, technical issue with HMRC's systems) you can appeal with evidence; HMRC accepts reasonable excuse appeals in most genuine cases.

Do I need an accountant or can I file Self Assessment myself?+

Legally you can file Self Assessment yourself via gov.uk for free, most simple sole-trader returns (single income source, basic expenses) are realistic to self-file. An accountant adds real value when: your trading profit is above £40,000 (extraction-strategy decisions matter), you have multiple income streams (PAYE + self-employment + property + dividends), you've crossed the £90,000 VAT threshold, you're considering incorporation, or you have an HMRC enquiry. Expect to pay £400-£1,500/year for a typical sole-trader accountant; the cost is itself a deductible expense.

How do payments on account work?+

When your Self Assessment tax bill exceeds £1,000 for the first time, HMRC requires payments on account toward NEXT year's tax. Half the current bill is due 31 January (alongside the current bill); the other half is due 31 July. So your first January after crossing the threshold can hit with a double-bill: last year's balance + first payment on account. Adjust via Form SA303 if you expect next year's income to drop substantially. Payments on account don't apply if more than 80% of your tax is collected via PAYE.

I'm buying a £600,000 main residence in 2025/26, what's my SDLT bill?+

**Standard rates from 1 April 2025**: 0% × £125,000 = £0; 2% × £125,000 (£125k-£250k slice) = £2,500; 5% × £350,000 (£250k-£600k slice) = £17,500. **Total SDLT: £20,000.** Compared to pre-April-2025 rates (£250,000 nil-rate threshold): 0% × £250,000 + 5% × £350,000 = £17,500 → £2,500 more SDLT after the reform. The threshold reversion bites particularly on lower-value purchases where the £125,000 vs £250,000 difference is a larger proportion of total cost.

First-time buyer purchasing £450,000 home, how much SDLT under new rules?+

**From 1 April 2025**: 0% up to £300,000; 5% on £300,001-£500,000. £450,000 - £300,000 = £150,000 at 5% = **£7,500 SDLT**. Pre-April 2025 (under old FTB relief £425,000 threshold): 0% up to £425,000; 5% on £425,000-£500,000. £450,000 - £425,000 = £25,000 at 5% = £1,250. **Cost increase from FTB reform: £6,250 on a £450,000 first-time purchase.** FTB relief is also no longer available at all for properties >£500,000 (down from £625,000), first-time buyers in higher-value markets (London, South East) lose the relief entirely under new thresholds.

Buying a BTL property for £250,000, what's my SDLT including HRAD surcharge?+

**Standard rates 1 April 2025 + 5% HRAD surcharge**: 5% on £0-£125,000 = £6,250; 7% on £125,001-£250,000 = £8,750. **Total: £15,000 SDLT.** Pre-October 2024 (3% HRAD): 3% on £125,000 + 5% on £125,000 = £3,750 + £6,250 = £10,000. **Cost increase from HRAD reform alone: £5,000 on £250,000 BTL purchase**. Total cost from BOTH October 2024 (HRAD) + April 2025 (threshold) reforms vs pre-September-2022 baseline is substantial, BTL acquisition costs significantly higher than 18 months ago.

My Ltd Co is buying a £700,000 residential property, what SDLT applies?+

**Companies purchasing residential property >£500,000** pay a FLAT RATE of 17% (raised from 15% on 31 October 2024). On £700,000 × 17% = **£119,000 SDLT**. Designed to discourage corporate ownership of high-value residential property (anti-tax-avoidance + anti-overseas-investor measure). Below £500,000, companies use the standard rates + 5% HRAD surcharge. Annual Tax on Enveloped Dwellings (ATED) ALSO applies annually on company-owned residential property over £500,000, additional ongoing cost. For genuine Ltd Co landlord structures, the company-purchase route remains viable below £500,000 + for portfolio acquisitions where rental yield + Section 24 exemption (Ltd Cos can deduct mortgage interest fully) compensate for the additional purchase taxes.

Last reviewed: 23 May 2026