Stamp Duty Land Tax (SDLT) is payable on the purchase of residential properties above a certain value in England and Northern Ireland. However, SDLT rules are different for those buying a second home. This commonly affects buyers of buy-to-let properties, holiday homes and those purchasing a property before selling their current property.
What is a second or additional property?
A property is generally considered a second home if, at the end of the day of completion, you own more than one residential property, and the new purchase is not a replacement of your main residence. Furthermore, if you are purchasing the property in the name of a company then it will automatically be considered a second home and the surcharge will apply.
Current SDLT rates for second homes
| Property or Lease Premium or Transfer Value | SDLT Rate |
| Up to £125,000 | 5% |
| From £125,001 to £250,000 | 7% |
| From £250,001 to £925,000 | 10% |
| From £925,001 to £1.5 million | 15% |
| Above £1.5 million | 17% |
Example
If you are purchasing a second home for £350,000 then the SDLT payable will be calculated as follows:
- 5% on the first £125,000 = £6,250
- 7% above £125,000 up to £250,000 = £8,750
- 10% on the final £100,000 = £10,000
The total SDLT payable will be £25,000
Additional tax payable by non-UK residents and companies
A two per cent surcharge is payable on top of the above rates of SDLT for properties purchased by non-UK residents (if you have not been present in the UK for at least 183 days during the 12 months prior to the purchase).
Please also note that SDLT is charged at 17% on residential properties costing more than £500,000 and purchased by companies.
Claiming a refund for second home SDLT
If you sell or give away your previous main residence within three years of buying your new main residence, then you can apply for a refund of the higher rate SDLT part of the SDLT paid. You should apply to HMRC within 12 months after the date of the sale or 12 months after the filing date of the SDLT for your new main residence, whichever date is later.
Other fees to be aware of when purchasing a second home
Since April 2025, English councils have been given the discretion to charge double council tax on second homes. For council tax rules, a second home is a furnished property where no one lives, or the owner has a main home elsewhere. There are exceptions to this, for example where a Grant of Probate has been issued for the second home, or it is being marketed for sale or rent.
If you are unsure whether the additional council tax applies to you, then you should contact your local council.
Professional Advice
SDLT rules are complex and depend on individual circumstances. Buyers should seek tax advice from a specialist to ensure the correct amount of SDLT is paid and to identify any potential reliefs or refunds.
This article is for general information purposes only and does not constitute legal or tax advice.
Always used an experienced conveyancer to progress the sale or purchase of your property. Contact a member of our Residential Property team to discuss your individual situation
