If you buy a second home, you will be liable for a 5% stamp duty surcharge. The government introduced the charge in 2016 to cool down the buy-to-let property market, and it increased in October 2024. However, you can reclaim stamp duty on second homes if you sell your original property within three years.
Having helped many customers in the South West London areas of Wimbledon, Wimbledon Village, Coombe, New Malden and Kingston deal with the issues around stamp duty on UK second homes, here are some of the most common questions we are asked about this government tax.
We also explain how to claim back stamp duty if you’re eligible, and when you may avoid the second home surcharge.
The full name given to Stamp Duty when you buy a property in England and Northern Ireland is Stamp Duty Land Tax (SDLT). This tax has slightly different names, depending on where you live. In Scotland, it is called Land and Buildings Transaction Tax (LBTT) and in Wales, Land Transaction Tax (LTT).
Stamp Duty Land Tax applies when you purchase a property over a specific price threshold. The tax rates are graded in bands, so your total amount will depend on the property purchase price. If you are buying a second home, be it for buy-to-let or your second home, you’ll have to pay an extra 5% in Stamp Duty on top of the normal stamp duty rate for each band. This government tax applies to freehold properties (houses, flats, land and other buildings) with or without a mortgage and leasehold properties.
As a first-time buyer, you will benefit from stamp duty tax relief if your buying property costs £500,000 or less. For more information, read our blog on Stamp Duty For First-Time Buyers.
New stamp duty rates and thresholds came into effect from 1 April 2025. The first-time buyers’ threshold of £425,000 on properties under £625,000, was lowered to £300,000 on properties under £500,000. Additionally, the zero percent threshold was halved from £250,000 to £125,000.
These are both reversions to previous thresholds, which were temporarily raised in the September 2022 mini-budget. The second home surcharge was also increased from 3% to 5% as of 31 October 2024, in the autumn budget 2022. Use a stamp duty calculator to work out your specific costs.
From April 2016 when the stamp duty charge on second homes was introduced, second-home and buy-to-let buyers in England and Wales must pay a surcharge on each band, rising from 3% to 5% in October 2024. The stamp duty rates and thresholds also changed in April 2024. See the table below for the current stamp duty rates:
| Property Value | Standard Stamp Duty Rate | Second Home Stamp Duty Rate |
| £0-£125,000 | 0% | 5% |
| £125,001 – £250,000 | 2% | 7% |
| £250,001 – £925,000 | 5% | 10% |
| £925,001-1.5m | 10% | 15% |
| £1.5m+ | 12% | 17% |
Stamp duty is payable on the portion of the purchase price that falls into each band.
For example, if you’re buying a second home worth £700,000 you would pay:
Your total stamp duty bill would be £60,000 for a second home – compared to £25,000 if it were your main home.
To calculate the stamp duty on a second home rates, you must understand the thresholds, rates and surcharges that apply to you – and a calculator can make this simpler. For an up-to-date estimate of how much SDLT you may be liable to pay on your residential property purchase in England, online calculators let you input a few details, including the type of property purchase and the purchase value. You can use the gov.uk website’s calculator or an alternative.
If you already own a residence, any additional property you buy to live in or rent out is a second home. That includes holiday homes, houses given to you by your family, and property abroad.
As an overseas resident, you must pay a 2% surcharge on any property purchase. If you are an overseas resident buying a second home, you will pay this surcharge on top of the second home stamp duty rates. This additional stamp duty charge applies if you purchase a second home with a UK resident.
Homes costing less than £40,000 are exempt from stamp duty. Caravans, mobile homes and houseboats are also exempt, whatever their value.
Say you’re looking to move but struggling to find a buyer and can afford to buy your dream property before you sell. You could end up owning two homes even though you plan to make the new home your primary residence. Whatever the reason, you will need to pay the extra tax if you buy a second home. But if you sell your original home within three years, you can reclaim the additional stamp duty on second homes.
You must pay the additional 5% stamp duty surcharge if you buy a second home, even if your first property is overseas.
If you are married or in a civil partnership, you are counted as one unit by HMRC. So even if you do not personally own one of the properties, you must pay the charge. This does not apply if you live with your partner but are unmarried.
If a property adjustment order has been made to hand the home over to your spouse as part of your divorce settlement, you won’t need to pay the charge.
Otherwise, you will be liable for the second home surcharge. However, you can claim back stamp duty on a second home if you sell your share of the property within three years.
If you inherit a property and then go on to buy another home, you will need to pay a higher rate of stamp duty. However, if you inherit a share in a property of 50% or less and buy another property within three years, you won’t need to pay the extra stamp duty tax.
If your name is on the deeds of the property, then you will pay the second home surcharge. If, however, you are helping your child to buy, either by giving them the deposit as a gift, acting as a guarantor for their loan or putting savings into a family offset mortgage, you won’t be liable for the charge – as long as the home will be in your child’s name and they don’t already own property.
If you are married or in a civil partnership, and one of you already owns a property, you must pay the stamp duty rates for second homes if you buy an additional property. If you are not married, and the other property is purchased solely in the name of the non-property owner, you will pay stamp duty at the standard rates.
Yes. All extensions to the lease are subject to stamp duty. The threshold at which you start to pay is £40,000.
If you sell your first property within three years (more in some exceptional circumstances) of buying a second home, you can claim back the additional 5% stamp duty from HMRC. You must apply for your refund for SDLT on second homes within 12 months. Visit the gov.uk website to apply for a refund online.
You will need this information to apply for your refund:
You can seek a refund if you sell your original home within 3 years of buying an additional property. There are also some second homes that doesn’t attract higher rates of stamp duty – such as properties worth under £40,000, and caravans, mobile homes and houseboats.
Alternatively, you could avoid paying stamp duty on homes you have gifting a family member the deposit for, or if you are only a guarantor.
Second home stamp duty isn’t likely to be scrapped, but SDLT rates and thresholds can change. We have previously seen a temporary reduction in September 2022, and stamp duty relief on purchases of 6 or more homes until 1 June 2024.
If you want to buy property in Wimbledon, Merton Park or Ham, we can advise you on the many complex issues involved. Contact us to find out more about our selection of properties.
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