What are the Stamp Duty implications when buying a second home?
If you own a house, chances are you’ll have paid Stamp Duty Land Tax (SDLT) at the time of purchase (unless you were a first-time buyer*). However, did you know you’re still required to pay SDLT on any additional properties you buy?
If you’re buying an additional residential property (over the value of £40,000) a higher rate of SDLT will apply – a further 3% on top of existing rates.
| House price | Existing SDLT rate | New SDLT rate for additional properties |
|---|---|---|
| £0k-£125k | 0% | 3% |
| £125k-£250k | 2% | 5% |
| £250k-£925k | 5% | 8% |
| £925k-£1.5m | 10% | 13% |
| Over £1.5m | 12% | 15% |
The surcharge does not apply if the additional property replaces your main residence (ie the house in which you intend to permanently live).
If you buy another home before selling your existing one, you will be liable to pay the SDLT surcharge. However, if you sell the original property within 36 months (3 years) of completing the purchase of the new one, you can claim a refund of the 3% surcharge either online or by completing a form.
If you’re considering buying a second property, our conveyancing team is on hand to help. Please email conveyancing@emsleys.co.uk or call 0113 264 4414 to speak to an expert.
*As of November 2017, first time buyers can claim SDLT relief on properties under the value of £500,000 - FIND OUT MORE.
