How Much Is Buy-to-Let Stamp Duty? 2026 Cost Calculator and Worked Examples
Exact SDLT figures for buy-to-let purchases from £150,000 to £1 million, with band-by-band breakdowns, yield impact analysis, and a full acquisition cost template.
Key Takeaways
- SDLT must be paid from your own funds within 14 days of completion. It cannot be added to a buy-to-let mortgage, so your cash requirement is deposit + SDLT + fees.
- At £250,000, a BTL landlord pays £15,000 in SDLT: six times the £2,500 a standard homebuyer pays on the same property.
- The effective SDLT rate (tax as a percentage of price) rises from around 5.3% at £150,000 to 8.0% at £500,000 as higher bands take a larger share.
- A £8,400 SDLT bill on a £210,000 property returning 5% gross yield takes about two years of gross rent to recover. Higher yields compress this payback period.
- Factoring SDLT into total acquisition cost typically reduces gross yield by 0.4 to 0.8 percentage points, enough to make low-yield properties fail a return threshold.
- For properties over £500,000 bought through a company, a flat 17% rate applies to the entire purchase price, costing £85,000 at £500,001 versus £40,000 for personal ownership.
In this article
Calculate Your BTL Stamp Duty
The quickest way to get your exact number is to use our buy-to-let stamp duty calculator. Enter your purchase price and it instantly applies the 5% additional dwelling surcharge to each band, showing you a full breakdown. The worked examples below cover the eight most common price points in detail.
How the surcharge works: The 5% surcharge is added to every standard SDLT band. On the first £125,000 the rate becomes 5% (0% + 5%). On £125,001 to £250,000 it becomes 7% (2% + 5%). On £250,001 to £925,000 it becomes 10% (5% + 5%). This is not a flat 5% on the total price; it applies within each band, producing a marginally higher effective rate as values climb into the upper bands. Not sure if the surcharge applies to you? See the complete buy-to-let stamp duty rules guide.
Worked Examples: 8 Price Points from £150k to £1M
The table below shows the total SDLT and effective rate at eight standard price points. Each row includes the full band breakdown so you can see exactly where the money goes.
| Price | Band breakdown | Total SDLT | Eff. rate |
|---|---|---|---|
| £150,000 | £125k at 5% + £25k at 7% | £8,000 | 5.3% |
| £200,000 | £125k at 5% + £75k at 7% | £11,500 | 5.8% |
| £250,000 | £125k at 5% + £125k at 7% | £15,000 | 6.0% |
| £300,000 | £125k at 5% + £125k at 7% + £50k at 10% | £20,000 | 6.7% |
| £400,000 | £125k at 5% + £125k at 7% + £150k at 10% | £30,000 | 7.5% |
| £500,000 | £125k at 5% + £125k at 7% + £250k at 10% | £40,000 | 8.0% |
| £750,000 | £125k at 5% + £125k at 7% + £500k at 10% | £65,000 | 8.7% |
| £1,000,000 | £125k at 5% + £125k at 7% + £675k at 10% + £75k at 15% | £93,750 | 9.4% |
All figures assume personal ownership with the 5% surcharge. Non-residents add 2%. For company purchases above £500,000, a flat 17% rate applies: see note below.
Company purchases above £500,000
When a limited company buys a residential property for more than £500,000, a flat 17% rate applies to the entire purchase price. At £500,001 this means £85,000 in SDLT, versus £40,000 for personal ownership on the same property. The two routes are identical in cost for properties below £500,000. For detailed portfolio strategies and incorporation analysis, see the portfolio landlord stamp duty guide.
Yield Impact Analysis
Stamp duty is a permanent day-one cost that reduces your effective return. Most landlords quote yield on purchase price alone, which overstates the actual return. The correct formula is: Annual Rent divided by Total Acquisition Cost, where total acquisition cost includes the purchase price, SDLT, legal fees, and any other upfront costs.
| Property price | BTL SDLT | Rent needed to recoup SDLT in 2 years (gross) | Monthly rent needed |
|---|---|---|---|
| £150,000 | £8,000 | £4,000/yr | £333 |
| £250,000 | £15,000 | £7,500/yr | £625 |
| £300,000 | £20,000 | £10,000/yr | £833 |
| £500,000 | £40,000 | £20,000/yr | £1,667 |
Yield calculation: £210,000 property at 5% gross yield
The 0.38 percentage point reduction in yield may appear modest, but it compounds: over a 10-year hold the total cost of stamp duty relative to yield grows as void periods, maintenance, and management fees also erode net returns. Use our rental yield calculator to model your specific scenario.
Total Acquisition Cost Breakdown
Stamp duty is the largest transaction cost for most landlords but not the only one. The template below shows a complete cost breakdown for a £250,000 BTL with a 25% deposit. Your own numbers will vary, but the structure applies to almost every purchase.
| Cost item | Typical range | Example (£250k) |
|---|---|---|
Deposit (25%) Standard BTL minimum; some lenders accept 20% | 20-40% | £62,500 |
Stamp Duty (SDLT) 5% surcharge on all BTL | Per rates table | £15,000 |
Solicitor / conveyancing Higher for BTL due to title checks | £1,500 to £3,000 | £2,000 |
Survey / valuation Homebuyer report recommended | £400 to £1,500 | £600 |
Mortgage arrangement fee Can be added to loan but adds interest cost | £1,000 to £2,000 | £1,500 |
Refurbishment / decoration Budget even for ‘ready to let’ properties | £0 to £20,000+ | £3,000 |
EPC / gas safety / letting fees Compliance required before first tenancy | £300 to £800 | £500 |
| Total cash required at completion | £85,100 |
In this example, stamp duty alone represents nearly 18% of total cash required on completion day. Landlords who plan around the deposit figure only and treat SDLT as an afterthought frequently find themselves scrambling for short-term finance at the worst possible moment.
Mortgage and Affordability Interaction
SDLT is a tax liability owed directly to HMRC, not part of the property's value. Mortgage lenders advance funds only against the property's worth; they will not include stamp duty in the loan amount. This means you cannot add stamp duty to a buy-to-let mortgage under normal circumstances.
You must have the full SDLT amount available as liquid funds by completion day. HMRC requires payment within 14 days of completion. There is no deferral option. When you calculate how much cash you need before making an offer, the calculation is:
Lenders also assess BTL affordability using an interest coverage ratio (ICR): typically the expected rent must be at least 125-145% of the mortgage payment at a stressed interest rate. SDLT does not affect the ICR calculation directly, but it does reduce the cash you have available for the deposit, which in turn affects your loan-to-value (LTV) ratio and therefore your mortgage rate.
Deposit vs SDLT priority: A lower deposit means a higher LTV, which means a higher mortgage rate and therefore higher monthly costs. In most cases, prioritising the deposit over SDLT results in a lower ongoing mortgage rate that saves more over the hold period than the SDLT costs. However, if you have insufficient cash for a viable deposit even after SDLT, the deal may not be viable at all.
Related guides
- Not sure if the surcharge applies to you? See the complete buy-to-let stamp duty rules guide.
- Buying 6+ properties or considering incorporation? See the portfolio landlord stamp duty guide.
- Building a portfolio rather than a single purchase? The multiple-property rules for portfolio landlords cover the 5% surcharge on every BTL, the 6+ bulk-transaction rule, and what MDR abolition changed.
- Analyse your rental return: rental yield calculator.
Frequently Asked Questions
How much stamp duty do I pay on a £300,000 buy-to-let?
£20,000. The calculation is: £125,000 at 5% = £6,250, plus £125,000 at 7% = £8,750, plus the remaining £50,000 at 10% = £5,000. Total: £20,000. The effective rate is 6.7% of the purchase price. A standard homebuyer on the same property would pay £5,000. The 5% surcharge adds £15,000 to the bill.
What is the effective SDLT rate on a buy-to-let purchase?
It depends on the price. At £150,000 the effective rate is 5.3%. At £250,000 it is 6.0%. At £400,000 it is 7.5%. At £750,000 it is 8.7%. At £1,000,000 it is 9.4%. The rate rises as a larger portion of the price falls into the higher bands (10% from £250,001 and 15% from £925,001). The minimum possible effective rate on any BTL purchase is 5% (for a property priced at exactly £125,000 or below), because the lowest band is already 5%.
How long does it take to recoup the SDLT cost through rental income?
At a 5% gross yield, SDLT equals roughly 1.3 years of gross rent for a £250,000 property (£15,000 SDLT divided by £12,500 annual rent). At a 4% yield it takes about 1.6 years. At 6% it takes about 1.1 years. These are gross figures: net of void periods, management fees, and maintenance, the real payback period is longer. Higher yields and longer hold periods reduce the relative impact of the upfront SDLT cost.
What are the total upfront costs for a buy-to-let purchase?
For a £250,000 BTL with a 25% deposit, total cash required at completion is typically around £80,000 to £90,000. This includes: £62,500 deposit, £15,000 SDLT, £2,000 legal fees, £600 survey, £1,500 mortgage arrangement fee, and £3,000 to £5,000 for any refurbishment or compliance requirements. SDLT alone represents about 18% of total cash outlay and is the second-largest cost after the deposit.
Should I prioritise saving for a larger deposit or SDLT first?
You need both: SDLT cannot be added to your mortgage. In most cases, a larger deposit produces long-term savings through a lower mortgage rate that outweigh the short-term benefit of having more cash on hand. However, the practical answer is that you need the full SDLT amount as liquid cash by completion day, so if you cannot cover both the deposit you need for an acceptable mortgage rate AND the SDLT, the transaction may not be viable yet. Build both targets into your savings plan from the start.
Reviewed by
Emma Richardson, MRICS
Chartered Surveyor & Property Tax Specialist
Emma Richardson is a RICS-qualified Chartered Surveyor with over 12 years of experience in UK property taxation. She founded Calculate My Stamp Duty UK to help buyers understand the complex world of property transaction taxes.