Your situation
How stamp duty is calculated
One method across the three nations, a handful of exceptions, and a few prices where the method breaks.
Checked by Radif Partners · Editorial policy · How we calculate
Stamp Duty Land Tax in England and Northern Ireland, Land and Buildings Transaction Tax in Scotland and Land Transaction Tax in Wales all work out the tax the same way: the price is cut into slices at each band threshold, each slice is taxed at its own rate, and the results are added. A £400,000 home bought as a sole residence in England pays nothing on the first £125,000, 2% on the next slice to £250,000 and 5% on the remaining £150,000, for £10,000 in total, an effective rate of 2.5%. The same home costs £13,350 in Scotland and £10,500 in Wales. The price taxed is the chargeable consideration: the money paid plus any debt taken over, such as a share of a mortgage. Three features break the smooth slice pattern: first-time buyer relief in England, which vanishes above £500,000; the £40,000 floor for second-home surcharges; and the 17% company rate on the whole price above £500,000.
Slice by slice: your price in any nation
Stamp Duty Land Tax, one home
£9,000
| Slices of the price taxed | 2 |
| Rate on your top slice | 5% |
| Effective rate on the whole price | 2.4% |
| Tax on the next £1,000 | £50 |
Standard residential rates
Slices, not brackets
Section 55 of the Finance Act 2003 sets out the method for SDLT, and LBTT and LTT follow the same logic: the rate for each band applies only to the part of the consideration that falls within that band. A bracket system would do the opposite, applying one rate to the whole price according to where it lands, and many buyers still picture stamp duty that way. For residential purchases by individuals, the whole price never jumps to a higher rate just because it crosses a threshold.
The method has three steps. Cut the price at each threshold of the applicable table. Multiply each slice by its rate. Add the results and round down to the pound. The table changes with the buyer’s situation, but the method does not.
The same £400,000 home in three nations
England and Northern Ireland
| Band | Amount in band | Rate | Tax |
|---|---|---|---|
| £0 to £125,000 | £125,000 | 0% | £0 |
| £125,001 to £250,000 | £125,000 | 2% | £2,500 |
| £250,001 to £925,000 | £150,000 | 5% | £7,500 |
| Total | £400,000 | 2.5% | £10,000 |
Most of the £10,000 comes from the 5% slice. The first two slices together cost £2,500, a small share of the bill.
Scotland
| Band | Amount in band | Rate | Tax |
|---|---|---|---|
| £0 to £145,000 | £145,000 | 0% | £0 |
| £145,001 to £250,000 | £105,000 | 2% | £2,100 |
| £250,001 to £325,000 | £75,000 | 5% | £3,750 |
| £325,001 to £750,000 | £75,000 | 10% | £7,500 |
| Total | £400,000 | 3.3% | £13,350 |
Scotland’s table has a higher nil band, £145,000, but its 10% band starts at £325,001, much lower than in England. That is why LBTT is lighter on modest homes and heavier from the mid-range upwards.
Wales
| Band | Amount in band | Rate | Tax |
|---|---|---|---|
| £0 to £225,000 | £225,000 | 0% | £0 |
| £225,001 to £400,000 | £175,000 | 6% | £10,500 |
| Total | £400,000 | 2.6% | £10,500 |
Wales leaves the first £225,000 untaxed for every buyer, then charges 6% straight away. There is no 2% step and no first-time buyer scale, so the slices are fewer and steeper.
Surcharges inside and outside the slices
The three nations treat second homes in three different ways, and the difference is visible in a breakdown. England keeps the slices and adds 5% to the rate of each, so a £400,000 additional property shows five slices at raised rates. Wales swaps in a separate higher table with its own thresholds. Scotland leaves the LBTT slices alone and adds a single line, the 8% supplement on the whole price.
| Band | Amount in band | Rate | Tax |
|---|---|---|---|
| £0 to £145,000 | £145,000 | 0% | £0 |
| £145,001 to £250,000 | £105,000 | 2% | £2,100 |
| £250,001 to £325,000 | £75,000 | 5% | £3,750 |
| £325,001 to £750,000 | £75,000 | 10% | £7,500 |
| Whole price (supplement) | £400,000 | 8% | £32,000 |
| Total | £400,000 | 11.3% | £45,350 |
Commercial and mixed-use property: same method, other tables
Shops, offices and buildings that mix homes with other uses are taxed with the slice method too, on the non-residential tables of each nation. In England that table has three slices: nothing to £150,000, 2% to £250,000 and 5% above.
| Band | Amount in band | Rate | Tax |
|---|---|---|---|
| £0 to £150,000 | £150,000 | 0% | £0 |
| £150,001 to £250,000 | £100,000 | 2% | £2,000 |
| Above £250,000 | £25,000 | 5% | £1,250 |
| Total | £275,000 | 1.2% | £3,250 |
No surcharge for second homes applies on these tables, which is why a mixed-use purchase can cost less than a pure residential one at the same price for a buyer who already owns a home. The commercial property calculator applies the Scottish and Welsh non-residential slices as well.
What counts as the price
The figure fed into the slices is the chargeable consideration, not the asking price or the valuation. For a normal sale it is the price in the contract. On a transfer of equity it is the money paid plus the share of any mortgage taken over, so a partner buying out the other’s half pays tax on cash and debt together. A genuine gift, with nothing paid and no debt assumed, has no consideration and is exempt, as are inheritances and transfers on divorce or dissolution (transfer of equity calculator).
Shared ownership adds a choice: tax on the full market value at the start, or tax on each share as it is bought. Both are applications of the same slice method to a different consideration (shared ownership).
The cost of the next £1,000
A useful way to read any table is to ask what one more thousand pounds on the offer costs. Under the slice method the answer is simply the rate of the top slice applied to that thousand.
| Price | England | Scotland | Wales |
|---|---|---|---|
| £100,000 | £0 | £0 | £0 |
| £200,000 | £20 | £20 | £0 |
| £300,000 | £50 | £50 | £60 |
| £500,000 | £50 | £100 | £75 |
| £1,000,000 | £100 | £120 | £100 |
| £2,000,000 | £120 | £120 | £120 |
The marginal cost stays modest at lower prices and rises steeply with the top band. Above £750,000 in Scotland and £1,500,000 in England and Wales, every extra thousand costs £120.
Working it out by hand
- Find the consideration: the contract price, plus any debt you take over, minus nothing for the deposit or fees.
- Pick the table that matches every buyer’s situation at the end of completion day: first-time buyer, one home, or additional dwelling, and add the non-resident surcharge in England if any buyer fails the day count.
- Cut the price at each threshold of that table and multiply each slice by its rate.
- Add the slices, add any supplement charged on the whole price, and round the total down to the pound.
The check that catches most mistakes is the effective rate. If the result divided by the price comes out above the top rate you reached, a slice has been taxed twice; if it comes out at the top rate exactly, the whole price has been taxed at one rate, which only the company flat rate ever does. A Scottish supplement adds its own fixed share on top, so remove it before running the check.
Where the slice method breaks: the cliffs
Pure slice systems have no cliffs: a pound more on the price can never add more than a fraction of a pound of tax. Reliefs and surcharges with a price limit break that rule, because they switch on or off for the whole price at once.
| Rule | Price | Tax at that price | Tax a pound higher |
|---|---|---|---|
| First-time buyer relief ends (England) | £500,000 | £10,000 | £15,000 |
| Higher rates start (England) | £39,999 | £0 | £2,000 |
| Company flat rate starts (England) | £500,000 | £40,000 | £85,000 |
| Additional Dwelling Supplement starts (Scotland) | £39,999 | £0 | £3,200 |
| Higher rates start (Wales) | £39,999 | £0 | £2,000 |
For an individual the largest is the end of English first-time buyer relief, where one pound costs £5,000. A company without a relief faces a bigger jump still at £500,000: £45,000 for the same pound. The £40,000 floors in all three nations are small in pounds but large in proportion, since below them a second home of that value pays nothing at all. Near any of these prices, a few pounds of negotiation matter more than the band tables suggest.