Stamp Duty On A Second Home

How Much Is Stamp Duty On A Second Home?.

Stamp Duty For Second Homes.

If you are buying an additional property or purchase a home and end up owning two properties, even for just a short time, you must pay extra stamp duty. This applies whether you’re buying a second home, a holiday home, a buy-to-let investment, or a residential property for any other purpose. You must also pay the extra stamp duty costs if the property you originally own is abroad. This applies even if you only own a share in a property.

How Much Stamp Duty Do You Pay On A Second Home?

Stamp Duty on a second property varies depending where in the UK you are buying.
Altered stamp duty rates are in effect July 8th, 2020 until June 30th, 2021 in England and Northern Ireland:

To calculate exactly how much stamp duty you pay on a second property, use our online stamp duty calculator

Property Value Sdlt Rate Sdlt Rate
£0-£500,000 0% 3%
£500,000 – £925,000 5% 8%
£250k to £925k 5%
£925,000 – £1.5m 10% 13%
Over £1.5m 12% 15%
Note:Non UK residents will pay a 2% surcharge from 1st April, 2021.

LBTT rates for a second home in Scotland.

If you’re buying an additional property, such as a holiday home or a buy to let, you will have to pay an extra 3% in Stamp Duty on top of the normal rate. This applies to all purchases over £40,000.

It doesn’t apply to caravans, mobile homes or houseboats.

Government rates of Stamp Duty are, at first glance, fairly straightforward, although different types of ownership will incur a variety of charges. The most straightforward SDLT calculation is for residential buyers simply changing their only home. The cost of Stamp Duty for first time buyers also differs, depending on the value of the property.

To calculate exactly how much stamp duty you pay on a second property, use our online stamp duty calculator

Purchase Price
Stamp Duty Rate
Additional Stamp Duty on Second Home
Up to £145,000 0% 4%
£145,001 to £250,000 2% 6%
£250,001 to £325,000 5% 9%
£325,001 to £750,000 10% 14%
Over £750,000 12% 16%

Stamp Duty On A Second Home In Wales.

If you’re buying an additional property, such as a holiday home or a buy to let, you will have to pay an extra 3% in Stamp Duty on top of the normal rate. This applies to all purchases over £40,000.

It doesn’t apply to caravans, mobile homes or houseboats.

Government rates of Stamp Duty are, at first glance, fairly straightforward, although different types of ownership will incur a variety of charges. The most straightforward SDLT calculation is for residential buyers simply changing their only home. The cost of Stamp Duty for first time buyers also differs, depending on the value of the property.

To calculate exactly how much stamp duty you pay on a second property, use our online stamp duty calculator

Purchase Price
Stamp Duty Rate
Additional Stamp Duty on Second Home
Up to £180,000 0% 4%
£180,001 to £250,000 0% 7.5%
£250,001 to £400,000 5% 9%
£400,001 to £750,000 7.5% 14%
£750,001 to £1,500,000 7.5% 14%
Over £1,500,000 12% 16%

Additional considerations when buying a second home

Stamp Duty On A Buy To Let If you’ve never owned a house before and are purchasing a buy-to-let property only, you won’t have to pay stamp duty on the higher buy-to-let rates. However, you won’t qualify for the first-time buyer stamp duty exemption/discount either, as this only applies to those who intend to live in the property. To calculate exactly how much stamp duty you will pay on a buy to let property, use our online stamp duty calculator Spouses Married couples, or civil partners, are classed as one unit by HMRC, so if one owns a main residence and the other buys an investment property, the stamp duty rates for a second property will still apply. Divorce There are special rules in place for divorce. If Partner 1 moves out of the marital home and a ‘property adjustment order’ is in place to hand the home over to Partner 2, then the additional stamp duty rate does not apply. Inheriting A Property If someone leaves a property and you become the sole owner, you have to pay the additional stamp duty if you buy another property after that. If you have only inherited a share of a property you may possibly be exempt: if you inherit 50% or less of a property but buy a residential property within three years, you don’t have to pay the extra 3% stamp duty. Buying A Property For Children Whoever’s name is on the deeds owns the property. If that is yours (the parents) If your name is and you own another property, then the 3% extra stamp duty applies. There are a few ways you can avoid it:
  • Gift A Deposit
  • Act As Guarantor
  • Get A Family Offset Mortgage
  Leasehold Extensions Stamp Duty Rates on a second property might apply on leasehold extensions as Stamp duty applies to lease extensions as it does to any other property. The £125,000 threshold for standard stamp duty means most people don’t have to pay it though. Stamp duty for second homes starts at a much lower price of £40,000. Paying more for the extension whilst owning other properties means you’ll pay the extra stamp duty costs. If the lease extension is on your main residence you are exempt.

Can I Claim A Stamp Duty Refund?

If you buy a second home and sell your previous main residence within three years then you can claim a refund.

If you sold your previous main residence on 29 October 2018 or later, HMRC must have your request for a refund within 12 months of the sale, or within 12 months of the filing date of the return relating to the new residence, whichever is later.

If you think you’ve paid the stamp duty on a second home by mistake then you can also apply for a refund.

Calculate Stamp Duty Costs.

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