Buying a second home or a buy to let in England normally costs you 5% of the entire purchase price on top of standard stamp duty. The surcharge rose from 3% to 5% for transactions completing on or after 31/10/2024, and a great deal of published guidance still quotes the old figure.
Standard SDLT + 5% of the full purchase price = what you actually payOn a £900,000 flat that is £35,000 of standard duty plus £45,000 of surcharge, so £80,000 in total. The surcharge applies to the whole price, not just the slice above a threshold.
That distinction catches people out more than any other part of the system. There is no tax-free band on the surcharge: at a purchase price of exactly £40,000 you would owe £2,000, even though standard stamp duty at that price is nil.
This guide sets out what you will pay at each price point, when the surcharge applies and when it does not, the legitimate ways to reduce it, and the ongoing costs that follow a second home purchase. It reflects the rules in force as at 15/08/2026.
These figures are for a UK resident individual buying an additional residential property in England or Northern Ireland, at the rates in force from 01/04/2025. Scotland and Wales are covered further down.
| Purchase price | Standard SDLT | 5% surcharge | Total on a second property | Effective rate |
|---|---|---|---|---|
| £300,000 | £5,000 | £15,000 | £20,000 | 6.67% |
| £500,000 | £15,000 | £25,000 | £40,000 | 8.00% |
| £750,000 | £27,500 | £37,500 | £65,000 | 8.67% |
| £900,000 | £35,000 | £45,000 | £80,000 | 8.89% |
| £1,000,000 | £43,750 | £50,000 | £93,750 | 9.38% |
| £1,250,000 | £68,750 | £62,500 | £131,250 | 10.50% |
| £1,500,000 | £93,750 | £75,000 | £168,750 | 11.25% |
| £2,000,000 | £153,750 | £100,000 | £253,750 | 12.69% |
Every higher-rate band is exactly the standard band plus five percentage points. So you never need the band table to get the answer: work out normal stamp duty, then add 5% of the full purchase price. The two methods always reconcile.
For context on our own patch, the average Wandsworth property was £660,000 in May 2026, which puts a typical second home purchase in the borough at around £55,000 of stamp duty. An average terraced house at £926,000 sits near £82,500. These are not marginal sums, and they are payable within 14 days of completion.
| Portion of the purchase price | Standard rate | Additional property rate |
|---|---|---|
| Up to £125,000 | 0% | 5% |
| £125,001 to £250,000 | 2% | 7% |
| £250,001 to £925,000 | 5% | 10% |
| £925,001 to £1,500,000 | 10% | 15% |
| Above £1,500,000 | 12% | 17% |
The return must be filed within 14 days of the effective date, which is normally completion, and the tax paid at the same time. Your conveyancer will usually handle this, but the liability is yours. Our guide to conveyancing fees covers the wider cost of the legal work, and stamp duty explained deals with standard purchases.
Four conditions must all be met for the higher rates to bite on a purchase by an individual. If any one of them fails, you pay standard rates.
Below that, no surcharge at all. This is a cliff edge rather than an allowance: at £40,000 the surcharge is £2,000, at £39,999 it is nil.
Buying a freehold reversion subject to a long lease does not attract the surcharge.
This is where most people are caught. See below for what counts.
If you are genuinely moving home and selling the old one, the surcharge does not apply, or is reclaimable.
The definition is wider than most buyers expect, and three points in particular catch people out.
A flat in Lisbon, a house in Lagos or a share of a family property overseas all count. HMRC asks about residential property you own or part own anywhere, not just in the UK.
While you are living together, a property owned by your spouse or civil partner is treated as owned by you. If either of you would trigger the higher rates, the whole purchase is at higher rates, even if only one of you is buying.
An inherited interest counts. The exception: a share of 50% or less inherited in the three years before your purchase is disregarded. Inherited more than three years ago, and it counts in full whatever its size.
A 25% share of a parent's Balham house inherited in 2024 is ignored when you buy in 2026. The identical share inherited in 2022 is not, and it will push your purchase into the higher rates. If you are dealing with a probate property, the date of death matters to your stamp duty position as much as to anything else.
Two further points worth knowing. Permanently separated spouses are not caught by the attribution rule. And a purchase by one spouse directly from the other, where they are living together and both are sole parties, is not a higher rates transaction.
The most common way people end up paying the surcharge is not by choice. If you buy your next home before your current one has sold, you own two properties on completion day, so the higher rates apply.
That money is recoverable. The rule is straightforward, and the deadlines are the part to diarise.
If you sold your previous main residence in the three years before the new purchase, the surcharge is not payable at all. Nothing to reclaim and nothing to fund.
You pay the surcharge upfront, then reclaim it once the old home sells. You must dispose of it within three years of completing on the new one.
Claims are made online through HMRC's repayment service, or on form SDLT16 by post. You will need the unique transaction reference number from the original return, both completion dates and the tax figures. HMRC typically pays within around 15 working days.
The three year window can be extended where the delay was genuinely beyond your control, for example a cladding remediation issue preventing a sale. The claim is made once the obstruction ends. This is discretionary, so document the reasons as they arise rather than reconstructing them later.
There are lawful routes that genuinely remove or reduce the charge. There is also an industry of refund agents promoting arguments that do not work, and HMRC has become considerably more aggressive about it.
| Route | How it works |
|---|---|
| Complete the sale first | Sell your existing main home on or before the day you buy, and the surcharge never becomes payable |
| Buy first and reclaim | Pay upfront, sell within three years, reclaim within the deadlines above |
| Price under £40,000 | No surcharge, and no return required at all below £40,000 |
| Other property worth under £40,000 | A low value interest elsewhere does not trigger condition three |
| Genuine mixed use property | Non-residential rates apply and the higher rates do not. It must be genuinely mixed, not a house with a paddock |
| Six or more dwellings in one transaction | Treated as non-residential property. This rule survived the abolition of multiple dwellings relief |
| Divorce or dissolution under a court order | Transfers made under a court order or connected agreement are exempt from stamp duty entirely |
| Genuine gifts with no consideration | Exempt, but see the warning below about mortgages |
| Inheritance | Property passing under a will or intestacy is not a chargeable transaction |
A gift is only exempt where there is genuinely no chargeable consideration. If the person receiving the property takes on the outstanding mortgage, that debt is consideration. Where the debt assumed is £40,000 or more and the recipient already owns a home, the 5% surcharge can apply to a transfer nobody thought of as a purchase. This catches families restructuring ownership more often than any other rule on this page.
HMRC issued a public warning on 31/07/2025 about bogus stamp duty refund claims, citing a case where a buyer paid a 30% contingent fee to an agent and then had to repay the tax with interest and penalties. Its position on responsibility is unambiguous: you remain liable even where an agent submitted the claim for you.
It was abolished for transactions completing on or after 01/06/2024 and there is no replacement. Any guide, calculator or adviser still suggesting you claim it on an annexe or a flat within a house is working from rules that ended over two years ago.
First-time buyer relief and the additional property surcharge are mutually exclusive by definition, because the relief requires you never to have owned a dwelling.
| Portion of the purchase price | Rate |
|---|---|
| Up to £300,000 | 0% |
| £300,001 to £500,000 | 5% |
| Above £500,000 | No relief at all |
The £500,000 figure is a cliff edge, not a taper: at £500,001 the relief disappears entirely and you pay standard rates on the whole price. The cap was £625,000 until 31/03/2025, so older guidance is misleading here too.
The disqualification is worldwide and includes property acquired by inheritance or gift. It also applies jointly: if either of two buyers has ever owned a dwelling anywhere, neither gets the relief. That last point regularly surprises couples buying in Clapham or Nine Elms where one partner inherited a share of a family property years ago.
A separate 2% surcharge applies to buyers who are not UK resident for stamp duty purposes, on residential property in England and Northern Ireland.
The residence test here is specific to stamp duty and is not the Statutory Residence Test used for income tax. You are non-resident for this purpose if you were not present in the UK for at least 183 days in the 12 months before completion.
The 2% sits on top of everything else. A non-resident individual buying an additional property above £1.5m pays 19% on that portion: 12% standard, plus 5% additional property, plus 2% non-resident.
It is reclaimable. If you spend 183 days or more in the UK during any continuous 365 day period falling between 364 days before and 365 days after completion, you can amend the return and recover the 2%. The amendment must be made within two years of the effective date.
For joint buyers, if any one purchaser is non-resident all are treated as non-resident, with one exception: where spouses or civil partners are living together and one is UK resident, both are treated as resident.
Incorporating is often suggested as a way around the surcharge. It is not, and the position is generally worse.
Only the price and lease conditions are tested for a company. There is no "do you own another dwelling" test and no main residence test, because a company cannot have one.
Residential purchases over £500,000 by companies and certain partnerships face a flat 17% on the whole price, up from 15% on 31/10/2024, unless a relief applies.
Companies holding residential property over £500,000 may owe the annual tax on enveloped dwellings, from £4,600 to £303,450 a year for 2026/27, and must file even where relief applies.
Reliefs from the 17% rate exist for genuine property rental businesses, developers and traders, and several other categories. Where a relief applies the purchase falls back to ordinary residential rates plus the 5% surcharge, not to nothing, and the relief can be withdrawn if the qualifying use ceases within three years.
None of that means incorporation is wrong. It can make sense on income tax and interest relief grounds for a growing portfolio, which our guide to building a property portfolio discusses. It is simply not a stamp duty saving, and anyone presenting it as one is mistaken.
Stamp duty is a one-off. The council tax premium is not, and it has changed materially.
Since 01/04/2025 English councils have been able to charge up to 100% additional council tax on dwellings that are substantially furnished but are nobody's sole or main residence. That is a doubling of the bill, every year, for as long as you hold the property as a second home.
| Borough | Second home premium | Applies from |
|---|---|---|
| Wandsworth | 100% | 01/04/2025 |
| Lambeth | 100% | 01/04/2025 |
| Merton | 100% | 01/04/2025 |
All three of the boroughs we operate across charge the full 100%. A Wandsworth bill of £660.05 becomes £1,320.10. Over a ten year hold that is meaningful money, and it is rarely factored into yield calculations at the point of purchase.
Empty property is treated more harshly still. A dwelling empty and substantially unfurnished for a year or more can carry a 100% premium, rising to 200% after five years and 300% after ten. The one year trigger replaced the previous two year rule on 01/04/2024.
There are exceptions, including properties actively marketed for sale or letting for up to 12 months, dwellings within 12 months of a grant of probate, annexes forming part of a main home, job-related accommodation, and properties with planning restrictions preventing year-round occupation. If you are letting rather than holding empty, the premium does not apply, and our guide to letting a property for the first time covers what that involves, and our property management team can run it for you if you would rather not do it yourself.
Announced at the Budget on 26/11/2025, a high value council tax surcharge would apply to residential property in England worth £2m or more.
| Property value | Proposed annual charge |
|---|---|
| £2m to £2.5m | £2,500 |
| £2.5m to £3.5m | £3,500 |
| £3.5m to £5m | £5,000 |
| Over £5m | £7,500 |
First, liability would fall on the owner, not the occupier, which is a departure from how council tax normally works. You would pay it even where the property is let and the tenant pays the council tax.
Second, the charges would be uprated annually by CPI but the £2m threshold is not stated to be uprated. Fiscal drag would pull more properties in over time, and the larger family houses between the commons are exactly the stock that sits closest to that line.
This is a proposal, not law. The consultation opened on 19/05/2026 and closed on 14/07/2026, and as at 15/08/2026 no government response or legislation has been published. The bands and amounts could change. Valuation would be carried out by the Valuation Office using comparable sales and automated models, with a two-stage appeal route and a deferral option for owners on low incomes.
Stamp duty land tax applies only in England and Northern Ireland. The devolved equivalents differ, and the gaps are large enough to matter if you are buying outside England.
The additional dwelling supplement is 8% of the total price for transactions on or after 05/12/2024, charged on the whole consideration.
Wales uses a separate higher rates table rather than a flat surcharge, in force from 11/12/2024.
The Welsh Government's own rates page lists current and historic tables together without prominent dating, and the superseded pre-11/12/2024 higher rates are widely reproduced elsewhere. If a table shows 4% as the lowest higher rate band, it is out of date.
At an effective rate approaching 9% on a £900,000 flat, plus a doubled council tax bill, the entry cost of a second property in SW London is materially higher than it was three years ago. Whether it still works depends on the yield, the hold period and what you are buying.
We have been advising landlords and second home buyers around the commons since 2008, across Battersea, Clapham, Balham, Wandsworth and Earlsfield. If you want a realistic view of achievable rent and resale before you commit, arrange a market appraisal and we will talk it through properly. Our landlord services are set out separately if you are buying to let.
Standard stamp duty plus 5% of the entire purchase price. On £300,000 that is £20,000, on £500,000 it is £40,000, on £900,000 it is £80,000 and on £1m it is £93,750. The surcharge rose from 3% to 5% for transactions completing on or after 31/10/2024.
It is 5%. The 3% rate applied until 30/10/2024 and was increased to 5% for transactions with an effective date on or after 31/10/2024. A great deal of online guidance, including some solicitor and agent pages, still quotes 3%. On a £900,000 purchase the difference is £18,000.
The whole price. Unlike standard stamp duty, there is no nil rate band on the surcharge. At a purchase price of exactly £40,000 the surcharge is £2,000, even though standard stamp duty at that price is nil.
The reliable routes are narrow: sell your existing main residence on or before you buy, or buy first and reclaim the surcharge by selling within three years. Purchases under £40,000, genuine mixed use property, six or more dwellings in one transaction, and transfers under a divorce court order also fall outside the charge. Be cautious of refund agents promoting uninhabitable property or annexe arguments. HMRC warned publicly about these in July 2025, and you remain liable for an incorrect claim even where an agent made it for you.
Yes, where you bought before selling your previous main residence. You must dispose of your entire interest in the old home within three years of the new purchase, and have lived in it as your main residence at some point in the three years before. The claim must reach HMRC by the later of 12 months after the sale, or 12 months after the filing date of the return on the new property. Claim online or on form SDLT16.
Yes. Residential property you own or part own anywhere in the world counts towards the test, provided your interest is worth £40,000 or more. So does property owned by your spouse or civil partner while you are living together.
Usually yes, with one exception. A share of 50% or less inherited in the three years before your purchase is disregarded. If you inherited more than three years ago, or your share exceeds half, it counts in full. Inheriting the property itself is not a chargeable transaction, but it affects what you pay on your next purchase.
No, and it is usually worse. Companies pay the 5% surcharge from their very first residential property, because the tests about owning another dwelling and replacing a main residence do not apply to them. Above £500,000 a flat 17% rate may apply, and the annual tax on enveloped dwellings can bite on top. Incorporation may still make sense for income tax reasons, but not for stamp duty.
Very probably. Since 01/04/2025 English councils have been able to charge up to 100% extra council tax on furnished second homes, and Wandsworth, Lambeth and Merton all apply the full 100%. That doubles the annual bill for as long as you hold it. Properties genuinely let to tenants are not affected.
No. Multiple dwellings relief was abolished for transactions completing on or after 01/06/2024 and there is no replacement. The separate rule treating six or more dwellings bought in a single transaction as non-residential property does survive.
First-time buyer relief and the surcharge cannot both apply, since the relief requires that you have never owned a dwelling anywhere in the world, including by inheritance or gift. From 01/04/2025 the relief gives 0% to £300,000 and 5% from £300,001 to £500,000, with no relief at all above £500,000. If either of two joint buyers has previously owned a home, neither qualifies.
Rates and thresholds stated are those in force at 15/08/2026. Stamp duty land tax applies in England and Northern Ireland; Scotland and Wales operate separate systems. Tax treatment depends on individual circumstances and may change. Sources: GOV.UK residential property rates, higher rates for additional properties, SDLT refunds, HMRC Stamp Duty Land Tax Manual, Revenue Scotland and the Welsh Government. Rampton Baseley are estate and letting agents, not tax advisers or solicitors. Nothing on this page is tax or legal advice, and you should take professional advice on your own circumstances before committing to a purchase.