Stamp Duty Land Tax (SDLT) in London is calculated on the same national rates as the rest of England, but the amounts involved are larger because London property prices are higher. Purchase prices in London frequently exceed the nil-rate threshold, meaning many first-time buyers face some SDLT liability. Many home movers pay five figures, and buyers of additional properties or investment properties pay a 5% surcharge on top of the standard rates. This guide shows the current rates, explains the reliefs available, and provides worked examples at London price points. For an overview of our London mortgage services, see our London mortgage services page.
Stamp duty is one of the biggest upfront costs when buying in London. Since April 2025, the thresholds have reverted to their permanent levels, meaning many buyers now pay more than they would have under the temporary thresholds that applied between September 2022 and March 2025. Understanding your stamp duty liability early helps you set a realistic budget and avoid surprises on completion day.
How Stamp Duty Works
Stamp Duty Land Tax (SDLT) applies when you buy a residential property or land in England or Northern Ireland above a certain price threshold. It is a progressive tax, meaning you pay different rates on different portions of the purchase price — similar to how income tax works. You do not pay the highest rate on the entire price.
SDLT is paid as a lump sum on completion. Your solicitor or conveyancer will usually handle the payment and submit the return to HMRC on your behalf. You have 14 days from completion to file and pay. Rates and thresholds are set by HMRC and can be checked at gov.uk/stamp-duty-land-tax/residential-property-rates.
Current Stamp Duty Rates (From April 2025)
As at May 2026, the following SDLT rates and thresholds apply. These are the permanent rates that came into effect on 1 April 2025 following the end of the temporary higher thresholds.
Standard Rates (Home Movers)
| Purchase price band | SDLT rate | Tax on band |
| Up to £125,000 | 0% | £0 |
| £125,001 – £250,000 | 2% | Up to £2,500 |
| £250,001 – £925,000 | 5% | Up to £33,750 |
| £925,001 – £1,500,000 | 10% | Up to £57,500 |
| Above £1,500,000 | 12% | Varies |
First-Time Buyer Rates
First-time buyers benefit from a higher nil-rate threshold, but only on properties up to £500,000. If the property costs more than £500,000, you pay standard rates on the full purchase price with no first-time buyer relief.
| Purchase price band | SDLT rate |
| Up to £300,000 | 0% |
| £300,001 – £500,000 | 5% |
| Above £500,000 | No relief — standard rates apply in full |
To qualify as a first-time buyer, you (and anyone you are buying with) must never have owned a residential property anywhere in the world.
Additional Property Rates
If you are buying a second home, buy-to-let property, or any additional residential property worth £40,000 or more, you pay a 5% surcharge on top of the standard rates. This surcharge applies to the entire purchase price, starting from the first pound. The additional property surcharge increased from 3% to 5% with effect from 31 October 2024. Full rules are on GOV.UK. If you are replacing your main residence, the surcharge may not apply, although the timing and ownership rules should be checked carefully with your solicitor.
Non-UK Residents
If you are treated as non-UK resident for SDLT purposes, an additional 2% surcharge applies on top of all other applicable rates. This surcharge is particularly relevant in London, where a higher proportion of buyers have non-UK residence status than in any other UK region. The residence test is specific and can depend on time spent in the UK in the 12 months before the transaction. Your solicitor can confirm whether the surcharge applies and whether a refund may be available if your residence status changes after completion.
The £500,000 First-Time Buyer Threshold in London
In London, the £500,000 ceiling on first-time buyer relief is particularly relevant because many purchases sit close to this level. Many London properties suitable for first-time buyers are priced close to or above this threshold, and the cost difference either side of it is substantial.
A first-time buyer purchasing at £499,000 pays £9,950 in stamp duty (5% on the £199,000 above £300,000). A first-time buyer purchasing at £501,000 loses all first-time buyer relief and pays standard rates in full: £15,550 — a difference of £5,600 on a £2,000 higher purchase price.
The £500,000 threshold is particularly relevant in London because many purchases sit close to this level. Understanding where the SDLT band boundaries sit can be useful when budgeting for a purchase.
What You’ll Pay in London: Worked Examples
London has a wide range of property values. The following tables show what stamp duty looks like at price points common in the London market. All figures are calculated using HMRC’s published rates as at April 2025. Individual calculations should be confirmed by your solicitor.
First-Time Buyers in London
| Property price | SDLT | Notes |
| £350,000 | £2,500 | 5% on £50,000 above £300,000 |
| £400,000 | £5,000 | 5% on £100,000 above £300,000 |
| £450,000 | £7,500 | 5% on £150,000 above £300,000 |
| £499,000 | £9,950 | 5% on £199,000 above £300,000. FTB relief applies. |
| £500,000 | £10,000 | 5% on £200,000 above £300,000. Maximum FTB relief. |
| £501,000 | £15,550 | Standard rates apply in full. FTB relief lost. £5,550 more than at £500,000. |
| £600,000 | £20,000 | Standard rates: 0% on first £125k, 2% on next £125k, 5% on remainder |
At the first-time buyer level, many London purchases exceed the £300,000 nil-rate band, meaning many London first-time buyers pay some stamp duty. The £500,000 relief limit means that buyers at the upper end of the first-time buyer market in London face standard rates — a material additional cost.
Home Movers in London
| Property price | SDLT | Notes |
| £450,000 | £12,500 | 0% to £125k, 2% to £250k, 5% to £450k |
| £550,000 | £17,500 | 0% to £125k, 2% to £250k, 5% to £550k |
| £600,000 | £20,000 | AIO example. 0% to £125k, 2% to £250k, 5% to £600k |
| £700,000 | £25,000 | 0% to £125k, 2% to £250k, 5% to £700k |
| £800,000 | £30,000 | 0% to £125k, 2% to £250k, 5% to £800k |
| £960,000 | £38,750 | 0% to £125k, 2% to £250k, 5% to £925k, 10% to £960k |
| £1,000,000 | £43,750 | 0% to £125k, 2% to £250k, 5% to £925k, 10% to £1m |
| £1,500,000 | £93,750 | Standard rates up to £1.5m. 12% applies above £1.5m. |
| £2,000,000 | £153,750 | 12% on £500,000 above £1.5m (£60,000) added to £93,750 |
At London home mover price points, stamp duty is a substantial upfront cost. At £600,000, a home mover pays £20,000 in SDLT. At £1,000,000, the bill is £43,750. These amounts must be funded separately from the mortgage and are paid in cash on completion. Prices vary by area, property condition, and market conditions.
Additional Property Buyers in London
Buyers of second homes, buy-to-let properties, and additional residential properties pay a 5% surcharge on top of the standard rates at every band. On a £500,000 additional property in London, the total SDLT would be £40,000. On a £600,000 additional property, it would be £50,000. On an £800,000 additional property, it would be £70,000. On a £1,000,000 additional property, it would be approximately £93,750. These are substantial sums and should be factored into the overall investment calculation. For more on buy-to-let lending in London, see our buy-to-let mortgage guide.
What Can Affect Your Stamp Duty Bill
The following is general guidance only. Your solicitor will confirm what applies to your purchase and file the SDLT return on your behalf.
Claim first-time buyer relief. If you qualify as a first-time buyer, you pay no SDLT on properties up to £300,000, and 5% on the portion between £300,001 and £500,000. In London, where most first-time buyer purchases exceed £300,000, the relief still provides a meaningful saving compared with standard rates — even though it does not eliminate the bill entirely. Make sure your solicitor applies the relief correctly on your SDLT return.
Understand the £500,000 first-time buyer relief limit. Properties above £500,000 attract standard rates on the full purchase price with no relief. As the worked examples above show, the cost difference either side of this boundary is £5,000 or more at typical London FTB prices. Being aware of where the SDLT band boundaries sit can be useful when budgeting or making an offer.
Understand the replacement main residence rules. If you temporarily own two properties because your sale has not yet completed when you buy your new home, you will initially pay the 5% additional property surcharge. However, if you sell your previous main residence within three years of buying the new one, you can usually claim a refund of the surcharge from HMRC, provided the relevant conditions are met. Your solicitor should confirm the position. This is important for anyone in a London chain or buying before selling.
Check the non-resident surcharge. If you are non-UK resident for SDLT purposes, the additional 2% applies on top of all other rates. At London prices, this adds meaningfully to the total bill. The residence test can be checked with your solicitor before exchange.
Use shared ownership rules where applicable. If you are buying through a shared ownership scheme, there may be different ways to calculate SDLT. Your solicitor should confirm the most appropriate approach.
Consider transfer of equity. Transfers of equity can have SDLT implications depending on whether any money changes hands or mortgage debt is assumed. The rules are specific, and your solicitor can confirm whether SDLT applies.
What Changed in April 2025
Between September 2022 and March 2025, temporary SDLT thresholds were in place. According to HMRC’s published historical rates (gov.uk/government/publications/rates-and-allowances-stamp-duty-land-tax), these provided a higher nil-rate band for standard buyers (£250,000, now reverted to £125,000) and for first-time buyers (£425,000, now reverted to £300,000). The maximum property price eligible for first-time buyer relief also dropped from £625,000 to £500,000.
Changes to SDLT thresholds can affect buying costs materially in London because property prices are often higher than national averages. Under the temporary thresholds, a first-time buyer purchasing a £400,000 property paid no stamp duty at all. Under the current rates, they pay £5,000. For home movers, the return of the 2% band on properties between £125,000 and £250,000 adds up to £2,500 to bills at typical London price points. These rates and thresholds apply as at May 2026.
Stamp Duty and Your Mortgage
SDLT is not usually added to the mortgage as a separate cost. It normally needs to be paid from your own funds on completion, alongside your deposit and any other costs such as legal fees. This means you need to budget for stamp duty on top of your deposit, not instead of it.
When a broker assesses how much you can afford to buy, stamp duty should be factored into the total cost of the purchase. In London, where stamp duty bills can be substantial, this can affect which properties are realistically within reach. For first-time buyers in London, the stamp duty bill adds to an already significant deposit requirement. On a £450,000 purchase, a 10% deposit is £45,000 and stamp duty is £7,500 — meaning you need around £53,000 in savings before legal fees and other costs. For a detailed guide to how much you can borrow in London, see how much you can borrow in London.
Why We Wrote This Guide
Fitch & Fitch is an independent, whole-of-market mortgage broker with offices in Canary Wharf, Cambridge, and Colchester. We are an appointed representative of JLM Mortgage Network, authorised and regulated by the Financial Conduct Authority (FCA Registration Numbers 955014 and 300629). You can verify this on the FCA Register at register.fca.org.uk.
Fitch & Fitch has received recognition from independent industry bodies including the Mortgage Strategy Awards, Mortgage Introducer Awards, and Legal & General Mortgage Club Awards. These awards are judged independently and can be verified on the respective awards websites.
We wrote this guide because we believe an informed borrower makes better decisions. For further information about our London mortgage services, visit our London hub page.
Frequently Asked Questions
What is the stamp duty in London in 2026?
London uses the same SDLT rates as the rest of England. As at May 2026: standard rates start at 0% up to £125,000, then 2%, 5%, 10% (above £925,000), and 12% (above £1,500,000). First-time buyers pay 0% up to £300,000 and 5% on the portion to £500,000, but lose all relief on properties above £500,000. Additional property buyers pay a 5% surcharge on top of standard rates. Non-UK residents pay a further 2% surcharge.
How much is stamp duty on a £960,000 house in London?
For a home mover, the stamp duty on a £960,000 property is £38,750: 0% on the first £125,000 (£0), 2% on the next £125,000 (£2,500), 5% on the next £675,000 up to £925,000 (£33,750), and 10% on the remaining £35,000 (£3,500). For an additional property, the 5% surcharge is added to each band, producing a significantly higher total.
How much is stamp duty on a £600,000 house in London?
For a home mover, £20,000: 0% on the first £125,000 (£0), 2% on the next £125,000 (£2,500), and 5% on the remaining £350,000 (£17,500). For a first-time buyer, the same £20,000 applies as standard rates — the property is above £500,000 so no first-time buyer relief is available.
Do first-time buyers pay stamp duty in London?
First-time buyers pay no stamp duty on properties up to £300,000. On properties between £300,001 and £500,000, they pay 5% on the portion above £300,000. On properties above £500,000, first-time buyer relief is lost entirely and standard rates apply. In London, many first-time buyer purchases exceed £300,000, so many London first-time buyers pay some stamp duty.
How much is stamp duty on a £400,000 house in London?
For a first-time buyer, £5,000 (5% on the £100,000 above £300,000). For a home mover, £10,000. For an additional property purchase, £30,000 including the 5% surcharge.
How much is stamp duty on a £500,000 house in London?
For a first-time buyer, £10,000 (5% on the £200,000 above £300,000) — this is the maximum FTB relief point. For a home mover, £15,000. For an additional property, £40,000 including the 5% surcharge. A property at £501,000 would cost a first-time buyer £15,550 in stamp duty — £5,550 more than at £500,000, because first-time buyer relief is lost entirely.
How is stamp duty calculated in 2026?
SDLT is calculated progressively. You pay each rate only on the portion of the price falling within that band. For a home mover buying at £600,000: 0% on the first £125,000 (£0), 2% on the next £125,000 (£2,500), and 5% on the remaining £350,000 (£17,500) — total £20,000. You do not pay 5% on the entire £600,000.
When do I have to pay stamp duty?
SDLT must be paid within 14 days of completion. Your solicitor or conveyancer will normally handle the payment and submit the return to HMRC on your behalf.
Can I add stamp duty to my mortgage?
Stamp duty is normally paid from your own funds on completion and is not usually added to the mortgage as a separate cost. Your broker and solicitor can explain how this fits within your wider purchase funding.
What is the additional property surcharge?
If you are buying a second home, buy-to-let, or any additional residential property worth £40,000 or more, you pay a 5% surcharge on top of the standard SDLT rates. This applies from the first pound of the purchase price. If you are replacing your main residence and sell the previous one within three years, you can usually claim a refund, provided the relevant conditions are met.
Has stamp duty changed for 2026?
As at May 2026, the rates and thresholds in this guide apply. The most recent change was in April 2025, when the temporary higher thresholds that had been in place since September 2022 ended. HMRC can change rates and thresholds in future budgets. The current rates can always be checked at gov.uk/stamp-duty-land-tax.
Next Steps
Stamp duty is one part of the total cost of buying a home in London. Understanding it early helps you set a realistic budget and avoid surprises on completion day.
If you are planning a purchase in London and want to understand how stamp duty fits alongside your deposit, mortgage, and other costs, we can walk you through the full picture. For further information about our London mortgage services, visit our London hub page.
Related Guides
How Much Can I Borrow for a Mortgage in London?
Buy-to-Let Mortgages in London
International Buyer Mortgages in London
This guide does not constitute tax advice. SDLT rates sourced from GOV.UK (gov.uk/stamp-duty-land-tax), April 2025