SDLT on Commercial Property: Rates and Examples
Written by Scott Jones, founder of CommercialPropertyKiln · Last updated
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Stamp Duty Land Tax (SDLT) is charged when you buy commercial property or take a new lease in England and Northern Ireland. The non-residential rates are lower than residential and carry no additional-property surcharge.
The non-residential rates
On a freehold purchase or a lease premium:
- Up to 150,000: 0%
- 150,001 to 250,000: 2%
- Above 250,000: 5%
There is no 5% additional-dwelling surcharge on non-residential or mixed-use property.
Mixed-use is taxed at these rates
If a property has any genuine non-residential element, the whole purchase is taxed at the non-residential rates, not the higher residential ones. A shop with a flat above, for example, is mixed-use. This can be a significant saving, and HMRC scrutinises mixed-use claims, so the non-residential element must be real.
A worked example
On a freehold purchase at 400,000: 0% on the first 150,000, 2% on the next 100,000 (2,000), and 5% on the final 150,000 (7,500), giving 9,500 in total.
Leases and next steps
A new lease is charged on the premium at the rates above and separately on the rent: see SDLT on commercial leases. Scotland and Wales have their own taxes: see Scotland and Wales. Work out the figure with our commercial stamp duty calculator.
What are the SDLT rates on commercial property?
0% up to 150,000, 2% to 250,000 and 5% above, with no additional-property surcharge.
Is mixed-use property taxed at residential or commercial rates?
If any part is non-residential, the whole purchase is taxed at the lower non-residential rates, which can be a significant saving.