Stamp Duty Changes for Additional Residential Properties: Attention All Landlords

Year Published: 2015

In his autumn statement earlier this year, the Chancellor announced that higher rates of Stamp Duty Land Tax (SDLT) for purchases of additional residential properties such as second homes or buy-to-let properties would come into effect from 01 April 2016.

The increase in rates will be 3% above the current SDLT rates and is payable on the total price paid for the property.

However, the new rates do not affect transactions up to £40,000 as these are exempt from SDLT payments.

The current rates and new rates* of SDLT for additional residential property purchases are:

Band Existing SDLT rates New additional property SDLT rate
*£0 – £125k 0% 3%
£125k – £250k 2% 5%
£250k – £925k 5% 8%
£925k – £1.5m 10% 13%
£1.5m + 12% 15%

*Only applies to purchases over £40,000. For purchases at £40,000 or under no SDLT payment is required.

How will this affect your additional purchases?

As an example, if you were to purchase a buy-to-let property for £350,000 and compare this to a purchase of a property at the same value for a residential home you would now be expected to pay a higher rate of SDLT. The residential home would only cost you £10,500 in stamp duty whereas the second home buyer could expect to pay £18,000.

As a landlord you need to make sure that you are aware of the new increase and that when purchasing buy-to-let properties you are considering the extra cost put in place. So don’t hold off on purchasing that new property, get in now before April 2016!

For more information on stamp duty payments or purchasing buy-to-let properties, please contact our Residential Property team on 0161 475 7676.


*figures taken from the HMRC website.

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