SDLT Rates History

Key facts

SDLT replaced the old Stamp Duty on land in December 2003.
The system changed from “slab” rates (one rate on the whole price) to “slice” rates (progressive bands) in December 2014.
A 3% surcharge for additional dwellings was introduced in April 2016 (increased to 5% from October 2024).
A 2% non-resident surcharge was added in April 2021.
COVID-19 prompted a temporary threshold increase to £500,000 in 2020–2021.

SDLT: A Brief History

Stamp Duty Land Tax was introduced on 1 December 2003 by the Finance Act 2003, replacing the centuries-old Stamp Duty on land transactions. Since then, the tax has been through numerous changes to rates, thresholds, reliefs, and surcharges.^[2]

This article provides a chronological overview of the most significant changes.

2003–2014: The Slab Era

When SDLT was introduced, it used a slab system where a single rate applied to the entire purchase price:^[3]

Purchase Price	SDLT Rate (2003)
Up to £60,000	0%
£60,001 – £250,000	1%
£250,001 – £500,000	3%
Over £500,000	4%

The nil-rate threshold was raised from £60,000 to £120,000 in 2005, and then to £125,000 in March 2006 — a level that remained the standard threshold for many years.

Key Changes 2003–2014

2006: Nil-rate threshold raised to £125,000
2010: A new 5% rate introduced for properties over £1 million
2012: A 7% rate introduced for properties over £2 million; 15% rate for “enveloped” purchases (residential property bought by companies) over £500,000

The slab problem: Under the slab system, buying a property for £250,000 cost £2,500 in SDLT (1%), but buying one for £250,001 cost £7,500 (3% on the entire price). This £5,000 jump on a £1 price increase was widely criticised and led to the reform in 2014.

December 2014: The Slice Reform

On 4 December 2014, the Chancellor announced a major reform, replacing the slab system with progressive “slice” rates for residential property. Under this system, each band applies only to the portion of the price within that band:^[1]

Band	Rate (from Dec 2014)
Up to £125,000	0%
£125,001 – £250,000	2%
£250,001 – £925,000	5%
£925,001 – £1,500,000	10%
Over £1,500,000	12%

This reform eliminated the cliff-edge problem and reduced SDLT for the vast majority of purchases below approximately £937,000.

April 2016: Additional Dwellings Surcharge

From 1 April 2016, a 3% surcharge was added on top of the standard rates for purchases of additional residential properties (second homes, buy-to-let properties, and company purchases). This was later increased to 5% from 31 October 2024.^[1]

November 2017: First-Time Buyer Relief

First-time buyer relief was introduced on 22 November 2017, providing a 0% rate on the first £300,000 and 5% on the portion from £300,001 to £500,000. This relief was not available for purchases above £500,000 (later raised to £625,000 in September 2022, then reverted to £500,000 from April 2025).

2020–2021: COVID Stamp Duty Holiday

In response to the COVID-19 pandemic, the nil-rate threshold for residential property was temporarily raised to £500,000 from 8 July 2020:^[1]

Period	Nil-Rate Threshold
8 Jul 2020 – 30 Jun 2021	£500,000
1 Jul 2021 – 30 Sep 2021	£250,000
From 1 Oct 2021	£125,000 (reverted)

April 2021: Non-Resident Surcharge

From 1 April 2021, a 2% surcharge was added for non-UK residents purchasing residential property in England and Northern Ireland. This is charged on top of all other rates (including the additional dwellings surcharge).^[1]

September 2022 – March 2025: Temporary Threshold Increase

The September 2022 mini-budget temporarily raised the nil-rate threshold from £125,000 to £250,000 and the first-time buyer threshold from £300,000 to £425,000. These increases were time-limited and reverted from 1 April 2025.

Current Rates (from 1 April 2025)

Band	Standard Rate	Additional Dwellings (+5%)
Up to £125,000	0%	5%
£125,001 – £250,000	2%	7%
£250,001 – £925,000	5%	10%
£925,001 – £1,500,000	10%	15%
Over £1,500,000	12%	17%

Tip: Always check the current rates at the time of your transaction. SDLT rates can change at short notice through Budget announcements, and the rate that applies is determined by the effective date (usually the date of completion) of your transaction.

Frequently Asked Questions

When did SDLT replace Stamp Duty on land?

SDLT replaced the old Stamp Duty on land and property on 1 December 2003, under the Finance Act 2003. The old Stamp Duty was a “slab” tax where a single rate applied to the entire purchase price. SDLT initially kept the slab structure before moving to progressive “slice” rates in 2014.

What was the “slab” system?

Under the slab system, the SDLT rate applied to the entire purchase price, not just the portion above each threshold. This created “cliff edges” where a small increase in price could result in a large jump in SDLT. For example, a property at £250,000 paid 1% (£2,500), but one at £250,001 paid 3% (£7,500). The slice system eliminated this problem.

When was the COVID stamp duty holiday?

The temporary SDLT threshold increase (often called the “stamp duty holiday”) was announced on 8 July 2020 and raised the nil-rate threshold to £500,000 for residential property. It was extended in March 2021 and then tapered — reducing to £250,000 from 1 July 2021, before returning to £125,000 on 1 October 2021.

What are the current SDLT rates from April 2025?

From 1 April 2025, the residential SDLT thresholds reverted to pre-September 2022 levels: 0% up to £125,000, 2% on £125,001–£250,000, 5% on £250,001–£925,000, 10% on £925,001–£1,500,000, and 12% above £1,500,000. First-time buyer relief nil-rate band returned to £300,000.

Sources

Stamp Duty Land Tax rates — GOV.UK
SDLT: historical development — HMRC
Finance Act 2003 — legislation.gov.uk