How to Claim a Stamp Duty Higher Rate Refund — The 3% Surcharge Explained

The 3% Higher Rate Surcharge

Since April 2016, buyers who already own a residential property pay an additional 3 percentage points of Stamp Duty Land Tax (SDLT) on the purchase of another residential property. This is known as the higher rate for additional dwellings, or simply the 3% surcharge.

The surcharge applies to the entire purchase price, not just the amount above a threshold. On a £400,000 property the surcharge adds £12,000 to the SDLT bill.

When Can You Get a Refund?

You are entitled to a full refund of the 3% surcharge if:

1. You paid the higher rate on a purchase because you owned another residential property at the time of completion, **and**

2. You subsequently sell (or otherwise dispose of) your previous main residence, **and**

3. The sale occurs within **three years** of the new purchase (or later in limited circumstances outside your control, such as a delayed sale due to COVID)

HMRC treats this as a replacement of a main residence: you were temporarily caught by the surcharge because you completed on the new home before selling the old one.

Common Scenarios

**Chain completion mismatch:** You bought before your sale completed. At the point of purchase you owned two properties, triggering the surcharge. When your old home sold within three years, you became entitled to a refund.

**New build:** You exchanged contracts on a new build and completed before your existing home sold. If the sale follows within three years, a refund applies.

**Retained property:** If you kept a property (rather than it being your main residence) and are buying a new main residence, the surcharge applies and no refund is available — because you are not replacing a main residence.

How to Claim

Claims are made directly to HMRC. You cannot reclaim through your solicitor after completion.

**Online:** Use HMRC’s online SDLT amendment service. You will need your UTRN (Unique Transaction Reference Number) from the original SDLT return, plus details of the disposal of the previous main residence.

**Post:** Complete SDLT amendment form using your original return details.

The time limit to claim is the later of:

• 12 months from the date of the sale of the previous main residence, **or**
• 12 months from the filing date of the original SDLT return

Do not miss this deadline. HMRC will not accept late claims without exceptional circumstances.

How Much Can You Reclaim?

The refund is the entire 3% surcharge paid on the purchase. Calculate this as 3% of the full purchase price of the new property.

**Example:** Purchased at £350,000. Surcharge = 3% × £350,000 = £10,500 refund.

Checking Your Purchase Date

Your exact completion date determines the three-year window. This date appears in your SDLT return and in the HM Land Registry title register. Property Passport UK displays transaction dates from the Land Registry for all registered properties, which can help you identify the completion date and calculate your refund deadline.