Stamp Duty Exemptions and Special Cases

The short answer

Most stamp duty questions fall into one of three special cases: you might not owe any tax at all (a handful of specific exemptions cover this), you might be paying more because you're not a UK resident (a 2% surcharge applies), or you're buying through shared ownership, where the rules work differently from a normal purchase. This guide covers all three, with the exact figures behind each.

When you don't pay any stamp duty at all

A handful of situations mean no Stamp Duty Land Tax is due, regardless of the property's value:

• Buying below the nil-rate threshold. If the price is under £125,000 in England and Northern Ireland (£145,000 in Scotland, £225,000 in Wales), there's simply nothing to pay under the standard rates — see our tax bands breakdown for the full thresholds.
• Transfers on divorce or separation. Transferring an interest in a property to your partner as part of a divorce, civil partnership dissolution, annulment, or a formal separation agreement or court order is exempt from SDLT entirely, whatever the property is worth. You don't need to notify HMRC.
• Property left to you in a will. Inheriting land or property has no SDLT to pay and nothing to report to HMRC, even if you take on an existing mortgage along with it — provided you don't hand over any additional money for it.
• Genuine gifts with no mortgage. If someone gives you a property outright and there's no outstanding mortgage on it, no SDLT is due. If you take on responsibility for an existing mortgage above the relevant threshold as part of the gift, tax can apply to that assumed debt — this is the same mechanic used in transfer of equity cases.

Outside of these situations, standard rates (or the reliefs and surcharges covered elsewhere on this site, such as first-time buyer relief or the additional property surcharge) apply as normal.

Stamp duty for non-UK residents

If you're not a UK resident, buying residential property in England or Northern Ireland means paying an extra 2% surcharge on top of whatever else applies — standard rates, first-time buyer relief, or the additional property surcharge for a second home or buy-to-let. It stacks on top of everything else rather than replacing any of it.

You're treated as UK resident for this purpose (and so avoid the surcharge) if you were present in the UK for at least 183 days in the 12 months before your purchase. Any day you're in the UK at the end of that day counts, and it doesn't have to be England specifically — time anywhere in the UK counts toward the total.

If you initially pay the surcharge but later become UK resident by this test — spending at least 183 days in the UK during any continuous 365-day period within two years of your purchase — you can apply to HMRC for a refund of the surcharge portion. The 2% non-resident surcharge applies only in England and Northern Ireland; it doesn't extend to LBTT in Scotland or LTT in Wales, per HMRC's guidance on the surcharge.

Shared ownership stamp duty

Shared ownership lets you buy a share of a property (commonly 25–75%) and pay rent on the rest, with the option to buy further shares later — a process known as staircasing. SDLT on the initial purchase works differently from a normal sale, and you get a choice of two approaches.

Option 1: Market value election

You pay SDLT upfront based on the property's full market value, as though you were buying it outright. Once that's paid, no further SDLT is due — however much you later staircase up, even to 100% ownership.

Option 2: Pay in stages

Instead of paying on the full value, you pay SDLT only on the premium for your initial share. No further return or payment is required as you staircase up — right up until your total share exceeds 80% of the property. At that point, a return becomes due covering everything you've acquired so far, since the transactions are treated as linked.

In this example the staged option looks like the obvious choice, since the premium falls entirely within the 0% band — but it only defers the decision rather than avoiding it. If you plan to staircase past 80% eventually, run both routes through the numbers first, since a large future SDLT bill calculated on then-current rates could outweigh what you'd have paid upfront today. Full mechanics are set out in HMRC's shared ownership SDLT guidance.

Frequently asked questions

This guide is for general information and doesn't constitute financial or legal advice. Non-resident status, exemptions, and shared ownership elections all depend on your specific circumstances — always confirm your position with a solicitor or tax adviser before relying on it.