Buy-to-Let Stamp Duty: How Much Landlords Pay

This guide covers England and Northern Ireland, with sections on Scotland and Wales. Rates checked against HMRC, Revenue Scotland and Welsh Revenue Authority guidance.

Buying an additional residential property to let in England or Northern Ireland usually means paying stamp duty land tax (SDLT) at the standard rates plus five percentage points, where the purchase costs £40,000 or more. On a £250,000 purchase that's £15,000 at the higher rates, against £2,500 at standard residential rates.

If the buy-to-let will be the only residential property you own, you can generally pay the standard rates instead. Companies follow different rules, and Scotland and Wales have their own taxes. All are covered below.

Key points:

• If you already own a home, a buy-to-let in England or Northern Ireland usually pays five percentage points more than the standard rates on every band
• Scotland has an 8% Additional Dwelling Supplement and Wales has its own higher rates, which apply on similar conditions
• For SDLT in England and Northern Ireland, you must file the return and pay within 14 days of completion
• Companies generally pay the higher rates on qualifying purchases of £40,000 or more, including their first property
• SDLT Multiple Dwellings Relief was abolished from 1 June 2024, subject to transitional protection for qualifying earlier contracts

What is stamp duty land tax?

Stamp duty land tax (SDLT) is the tax you pay when you buy property or land in England or Northern Ireland. Scotland has Land and Buildings Transaction Tax (LBTT) and Wales has Land Transaction Tax (LTT) instead.

If you already own a home and buy another one, such as a buy-to-let, you usually pay the higher rates for additional properties. The surcharge started at 3% on 1 April 2016 and rose to 5% on 31 October 2024.

How much stamp duty do you pay on a buy-to-let?

Buy-to-let stamp duty rates in England and Northern Ireland

You pay each rate only on the part of the price that falls within that band.

Rates from 1 April 2025. The higher rates don't apply to purchases under £40,000. If you're non-UK resident for SDLT purposes, you pay a further 2%. Source: GOV.UK.

Worked examples

These figures assume the higher rates apply, with no non-resident surcharge and no other relief or special treatment.

For example, a £400,000 buy-to-let at the higher rates pays £30,000: 5% of the first £125,000 (£6,250), 7% of the next £125,000 (£8,750) and 10% of the remaining £150,000 (£15,000).

To work out your own figure, use our free stamp duty calculator.

Buy-to-let rates in Scotland and Wales

Scotland: LBTT and the Additional Dwelling Supplement

In Scotland you pay Land and Buildings Transaction Tax (LBTT) instead of stamp duty. If you already own a home, a buy-to-let will usually also attract the Additional Dwelling Supplement (ADS): 8% of the total purchase price for properties of £40,000 or more, for contracts from 5 December 2024 (transitional rules cover some earlier contracts).

Plus ADS of 8% of the whole price where it applies. Source: Revenue Scotland.

Wales: Land Transaction Tax higher rates

In Wales you pay Land Transaction Tax (LTT). If you already own a home, buy-to-lets and second homes usually pay the higher rates.

Main rates from 10 October 2022; higher rates from 11 December 2024. Source: GOV.WALES.

When does the surcharge apply?

For an individual, the higher rates generally apply if, at the end of the day you complete, you own more than one home anywhere in the world and you're not replacing your main home (GOV.UK). These are the situations landlords most often ask about.

Your first buy-to-let, if you don't own a home

If the buy-to-let will be the only residential property you own, you can generally pay the standard rates. First-time buyer relief isn't available, because it only applies to buyers who will live in the property (see below).

Joint buyers, spouses and partners

If you buy with someone else and any one of you would pay the higher rates, the whole purchase pays them. Spouses and civil partners count as one unit, so if your spouse owns a home you pay the higher rates even when you buy in your sole name, unless you're permanently separated. Unmarried partners aren't linked in this way.

Let to buy

If you keep your current home to let out and buy a new home to live in, you'll own two homes and you haven't sold your previous main home. So you usually pay the higher rates on the new purchase.

Replacing your main home

If you own buy-to-lets and buy a new main home, you avoid the surcharge only if you're replacing your main residence. If you buy before selling your old main home, you pay the higher rates, then you can reclaim the surcharge if you sell the old home within three years. You must claim within 12 months of the sale, or of the filing date of your return if that's later.

First-time buyer relief doesn't apply

First-time buyer relief can't be used on a buy-to-let. Every buyer must be a first-time buyer and intend to live in the property as their main home (GOV.UK).

Buying a buy-to-let through a limited company

Companies generally pay the higher residential rates on qualifying purchases of £40,000 or more, including their first property.

A company buying a home for more than £500,000 can face a flat 17% rate. Relief from the 17% rate is available in some cases, such as when the property is let as part of a qualifying property rental business. The relief doesn't make the purchase SDLT-free: the ordinary higher residential rates generally still apply (GOV.UK).

Moving a property you already own into a company usually means paying stamp duty again, so take advice from a tax adviser before you incorporate.

Multiple dwellings relief has ended

SDLT Multiple Dwellings Relief used to cut stamp duty when you bought several homes in one transaction. It was abolished from 1 June 2024, subject to transitional protection for qualifying earlier contracts, generally those exchanged on or before 6 March 2024 (GOV.UK). Read more about the end of multiple dwellings relief.

When and how to pay stamp duty land tax

For SDLT in England and Northern Ireland, file the return and pay within 14 days of the effective date, usually completion. Your conveyancer usually does this for you, but you remain responsible. You need to file a return for most purchases of £40,000 or more, even if no tax is due.

If the return is late, HMRC charges a £100 penalty, rising to £200 after three months, and further tax-based penalties can apply after 12 months. Interest is charged on any unpaid tax (GOV.UK).

In Scotland and Wales, LBTT and LTT returns are generally due within 30 days. Follow Revenue Scotland's or the Welsh Revenue Authority's rules for returns and payment.

Frequently asked questions

I already own a home abroad. Will I pay the higher rates on a buy-to-let in England?

Usually, yes. Homes you own anywhere in the world count towards the higher-rate test, so a buy-to-let in England or Northern Ireland will usually pay the higher rates. If you're non-UK resident for SDLT purposes, you also pay a 2% surcharge (since 1 April 2021). SDLT has its own residence test, so your income tax residence or nationality doesn't decide this automatically.

What happens if I inherit a property?

You don't pay stamp duty on inheriting a property, but it can affect your next purchase.

An inherited share is ignored for the higher-rate test if you became entitled to it within the three years before you buy, and the combined share held by you and your spouse or civil partner hasn't been more than 50% during that time. The three years start when you became entitled to the share, which isn't always the date of death. Outside those conditions, the inherited interest may count towards the higher-rate test (HMRC).

Keep track of your purchase costs

Stamp duty can be an allowable cost of buying a property when you work out capital gains tax on a later sale (HMRC). For how your rental profits are taxed, see our guide to rental income tax.

Landlord Studio helps you record property expenses, store documents such as your completion statement, and keep your rental income and costs in one place.

Sources

• GOV.UK: Stamp Duty Land Tax residential property rates
• GOV.UK: buying an additional residential property
• GOV.UK: SDLT rates for non-UK resident

This guide is general information, not tax advice. Check your figures with your conveyancer or a tax adviser before you buy.