What SDLT Reliefs Are Available?

When you buy property or land in England or Northern Ireland, you may need to pay Stamp Duty Land Tax (SDLT). However, several reliefs can reduce or eliminate the tax you owe. Understanding which reliefs apply to your situation could save you thousands of pounds, but you must...

# What SDLT Reliefs Are Available?

How to claim SDLT relief

To claim any SDLT relief, you must fill in a Stamp Duty Land Tax return, even if the relief means you don't owe any tax. You enter the appropriate relief code in box 9 of the return from the dropdown list provided.

HMRC may charge you a penalty if you claim relief you're not entitled to, so make sure you meet all the qualifying conditions before submitting your claim.

First-Time Buyers' Relief

If you and anyone else you're buying with are all first-time buyers purchasing a residential property, you can claim this relief when:

You intend to live in the property as your main home
The purchase price is £500,000 or less

When you qualify, you'll pay:

0% on the first £300,000
5% on the portion between £300,001 and £500,000

If the purchase price exceeds £500,000, you cannot claim the relief at all and must pay the standard SDLT rates on the entire purchase price.

Note: These rates apply to purchases from 1 April 2025 onwards. Different rates applied to first-time buyer purchases before this date.

To claim First-Time Buyers' Relief, enter relief code 32 in your SDLT return.

Shared ownership properties for first-time buyers

First-time buyers purchasing shared ownership properties can also claim relief when:

You intend to live in the property as your main home
The market value of the shared ownership property is £500,000 or less

You can claim the relief whether you make a market value election or choose to pay SDLT in stages when the lease begins. The relief also applies to your rent payments, meaning you pay no SDLT on the rent portion.

Multiple Dwellings Relief (abolished)

Multiple Dwellings Relief (MDR) has been abolished and can no longer be claimed for transactions that complete or substantially perform on or after 1 June 2024.

For transactions before 1 June 2024

You can still claim MDR for purchases of more than one dwelling where:

Contracts were exchanged on or before 6 March 2024
Contracts were substantially performed before 1 June 2024, or
Contracts completed before 1 June 2024

Under this relief, you calculated tax by dividing the total amount paid by the number of dwellings, working out the tax on that figure, then multiplying by the number of dwellings. The minimum tax rate under MDR was 1% of the total amount paid for the dwellings.

The relief didn't apply to transfers of freehold reversions or headleases where a dwelling had a lease of 21 years or more. Higher rates for additional residential properties could still apply.

You may need to recalculate and file another return if the number of dwellings reduces within three years of the transaction—for example, if you combine two flats into one.

To claim Multiple Dwellings Relief (for eligible historic transactions), enter relief code 33 on your return.

Building company buys an individual's home

When a building company or property trader buys someone's home as part of a deal where that person buys a new home from them, the company's purchase may be exempt from SDLT if certain conditions are met.

The seller must:

Have lived in the property as their main or only home at some point during the two years before the building company bought it
Buy a new home from the house building company
Intend to live in the new property as their main or only home

The land area that the building company or property trader buys with the old home must not exceed certain limits—normally 0.5 hectares.

This relief doesn't apply to individuals who simply swap houses with each other.

To claim this relief, enter code 08 in your SDLT return.

Employer buys an employee's home

When an employer or property trader buys an employee's house because the employee must relocate for work, the purchase is exempt from SDLT if all these conditions are met:

The employee lived in the property as their main or only home at some point during the two years before their employer bought it
The employer or property trader is buying the house because the employee must move as a result of a job relocation
The price paid is not more than the market value of the property
The land area being purchased is within certain limits—normally 0.5 hectares

To claim this relief, enter relief code 09 in your SDLT return.

Compulsory purchases

When a local authority makes a compulsory purchase order so a development by another party (such as a property developer) can proceed, there are normally two sales: the owner sells to the local authority, and the local authority sells to the developer.

The local authority can claim relief from SDLT when they buy the property, avoiding double taxation. Any body with the legal power to compulsorily buy land or property can claim this relief, even if the actual sale isn't made under those compulsory powers, provided the sale enables development by a third party.

Regional differences

SDLT applies only to property transactions in England and Northern Ireland. Different taxes apply elsewhere:

Scotland (from 1 April 2015): Land and Buildings Transaction Tax
Wales (from 1 April 2018): Land Transaction Tax

Sources

Stamp Duty Land Tax relief for land or property transactions

This article provides general guidance based on current HMRC rules. For advice specific to your situation, speak to your accountant.