What is Stamp Duty?

Stamp duty is a tax levied on legal documents — most notably on property transfers — calculated as a percentage of the transaction value and paid by the buyer to register the transaction.

Stamp duty (UK SDLT, Australian transfer duty, French droits de mutation) is a major closing-cost item in many jurisdictions, often 1–10% of the price with progressive bands. First-time buyers, primary residences and certain price tiers may qualify for relief.

Switzerland does not levy a federal stamp duty on property transfers, but most cantons charge a 'Handänderungssteuer' of 0.2–3.3%. Geneva and Vaud are at the high end; Zurich abolished its transfer tax in 2005.

Example

A GBP 600,000 UK home purchase by a second-home buyer incurs roughly GBP 20,000 in SDLT under standard bands — a major cash outlay on top of the deposit and legal fees.

Related terms

Closing Costs

Closing costs are the various fees and expenses — beyond the property price — paid by buyer and seller at the completion of a real-estate transaction, typically 2–5% of the purchase price.

Property Value

Property value is the estimated worth of a piece of real estate, determined by appraisal, comparable sales or income approach, and used for sale pricing, mortgage underwriting, taxation and insurance.

Freehold

Freehold is the most absolute form of property ownership, granting the holder unlimited time of possession of the land and any buildings on it, subject only to statutory obligations such as zoning, taxes and easements.

Appraisal

An appraisal is a professional, independent estimate of a property's market value, conducted by a licensed appraiser, used by lenders to size mortgages and by buyers and sellers to set prices.

Frequently asked questions

Who pays stamp duty?+

Almost always the buyer, at or shortly after closing, to register ownership.

Are there exemptions?+

Yes — first-time buyer relief, primary residence thresholds, and intra-family transfers may reduce or eliminate stamp duty in many jurisdictions.

Is stamp duty deductible?+

Not for owner-occupiers in most countries; for investment properties it is usually capitalised into the cost base for future capital-gains calculations.