Stamp Duty on a Second Home: The Higher Rates Explained for 2026

What the higher rate is

Since 1 April 2016, anyone buying an additional residential property in England or Northern Ireland (a second home, a buy-to-let, or a holiday home) pays Stamp Duty Land Tax at a higher rate than someone buying their main residence. The higher rate is currently a 5% surcharge on top of the standard SDLT bands. It applies to the whole purchase price, not just the portion above the standard threshold.

Wales has its own equivalent (Land Transaction Tax) with similar surcharge rules. Scotland has Land and Buildings Transaction Tax with an Additional Dwelling Supplement.

This guide focuses on the SDLT regime in England and Northern Ireland.

The standard SDLT bands (for second homes)

For purchases of additional residential property in 2026:

These rates apply to the portion of the price falling in each band. So for a £500,000 second home:

• 5% on the first £250,000 = £12,500
• 10% on the next £250,000 = £25,000
• Total: £37,500

That is around 7.5% of the purchase price as SDLT, just for it being a second home. The same property bought as a main residence would attract £12,500 in SDLT, around 2.5%.

When the higher rate applies

The higher rate applies when, at the end of the day of completion:

1. You own (or are deemed to own) more than one residential property anywhere in the world

2. The property you are buying is not replacing your only or main residence

So if you own one home and buy a second, the higher rate applies. If you own one home, sell it, and buy another to replace it, the higher rate does not apply. If you own one home and buy a holiday cottage in Cornwall while keeping the existing home, the higher rate applies.

The "anywhere in the world" rule catches buyers who own a property abroad. If you own a flat in Spain and buy your first UK home, you may still pay the higher rate.

When you can claim a refund

If you pay the higher rate because you have not yet sold your previous main residence, you can claim a refund within 12 months of selling the previous home (or within 12 months of the SDLT filing date for the new purchase, whichever is later). The refund window was originally 36 months but was reduced to 12 in most cases.

The refund process is HMRC form-based and typically takes 4 to 8 weeks to be paid.

First time buyer relief and the higher rate

First time buyer relief reduces the SDLT for first-time buyers up to a price cap. The higher rate does not apply to first time buyers because, by definition, they do not already own a property. There is no interaction.

Specific rules and exceptions

Replacement of main residence

If you are selling your existing main residence and buying a new one to live in, the higher rate does not apply, even if there is a brief overlap during the transaction. You must complete the sale of the previous home within 36 months (claim window) of the new purchase.

Married couples and civil partners

Spouses and civil partners are treated as a single unit for SDLT higher rate purposes. If either of you owns a property, the higher rate applies to a purchase by the other unless it is a replacement.

Properties under £40,000

The higher rate does not apply to properties below £40,000. Land without a dwelling on it (development land) is not subject to the higher rate.

Mixed use properties

If a property is part residential, part commercial, the SDLT rules treat it as commercial and the higher rate does not apply. This can be a tax planning route for buyers of properties with a shop on the ground floor and a flat above, although HMRC has tightened up on aggressive use of this rule.

Buying multiple properties at once

There is a relief called Multiple Dwellings Relief (MDR) that historically reduced SDLT for transactions involving multiple residential properties. MDR was abolished from 1 June 2024 except in certain narrow circumstances. Most multi-property purchases are now taxed at the higher rate on each dwelling.

How to calculate your stamp duty

The cleanest way is to use HMRC's online SDLT calculator. Bring the property purchase price, the date, the property type, and your status (first-time buyer, second home, buy-to-let).

Before you buy, look up the property on Property Passport UK at [/search](/search) to confirm tenure (freehold or leasehold) and the EPC property type. Both affect SDLT calculation in edge cases (mixed use, agricultural land, etc).

Common pitfalls

1. Forgetting overseas property: a flat you own abroad triggers the higher rate on a UK first home

2. Family arrangements: helping a child onto the property ladder by being named on the deeds can trigger the higher rate on your own next purchase

3. Inherited shares of property: a small inherited share in a family home can count towards the "more than one" test

4. Buying through a company: company purchases are subject to the higher rate plus the 15% rate for high-value purchases

5. Buying off-plan: completion date matters, not exchange date

For complex situations, talk to a tax adviser before you buy.

Look up the property data behind your tax decisions

Property Passport UK shows verified data for every one of the 19.35 million properties in England and Wales: tenure, EPC, sold prices, flood risk, listed status. Use it to research before you buy a second home, plan a sale, or work out a tax position. Search any address at [/search](/search). Every fact comes from an official UK government source.

Related guides

• Stamp duty second home explained
• CGT on second home UK
• Private residence relief explained
• Inheritance tax on property