The stamp duty land tax (SDLT) surcharge levied on purchases of second and subsequent homes has been increased from 3% to 5% with immediate effect
The stamp duty land tax (SDLT) surcharge levied on purchases of second and subsequent homes has been increased from 3% to 5% with immediate effect. The higher rate applies to purchases of second homes and buy-to-let residential properties. The change applies to purchases with an effective date on or after 31 October 2024. The single rate of SDLT that is charged on the purchase of dwellings costing more than £500,000 when purchased by corporate bodies has also increased by two percentage points from 15% to 17% from 31 October 2024.
As previously announced, the main thresholds for residential property and SDLT relief for first-time buyers will revert to their September 2022 levels on 1 April 2025. Currently an individual can purchase a residential property up to the value of £250,000 without needing to pay any SDLT. This threshold will reduce to £125,000 from 1 April 2025. Where the individual is a first-time buyer and the total value of the property is less than £625,000 there will currently be no SDLT to pay on the first £425,000 and 5% on the balance. From 1 April 2025 these will change to a max property value of £500,000 and only the first £300,000 will be effectively free of SDLT with the remaining balance being subject to a 5% charge.
Contact our expert Simon Cyna at simon.cyna@hhllp.co.uk for more information.
