Two 2024-2025 changes most calculators miss
The post-Autumn-2024 + post-April-2025 SDLT regime that applies to all 2026 completions:
1. HRAD jumped from 3% to 5% on 30 October 2024.
With the prior 3% rate, a £400,000 second-home buyer paid base £7,500 + HRAD £12,000 = £19,500. Same purchase post-October 2024: base £7,500 + HRAD £20,000 = £27,500. That is £8,000 extra on a single transaction. Most calculators on the internet still show the old 3% number; verify yours is updated.
2. Nil-rate threshold reverted from £250,000 to £125,000 on 1 April 2025.
For 2 years (Sept 2022 to March 2025) the nil-rate was temporarily raised to £250K as part of post-COVID stimulus. From 1 April 2025 it reverts to the permanent £125K, adding up to £2,500 of SDLT to standard purchases between £125K-£250K.
Worked example: same £400,000 second-home buyer.
- Pre-October 2024 (3% HRAD, £250K nil-rate): SDLT £0 + 5% on £150K + 3% on £400K = £0 + £7,500 + £12,000 = £19,500
- 2026 (5% HRAD, £125K nil-rate): 2% on £125K (the GBP 125-250K slice) + 5% on £150K + 5% HRAD on £400K = £2,500 + £7,500 + £20,000 = £30,000
That is £10,500 extra on the same property purely from rule changes. Buyers who took a long sales pipeline assuming old rules can face nasty surprises at completion.
Third change worth noting: the additional 1 percentage point that was proposed for non-resident company purchases was NOT implemented; standard 2% non-resident surcharge still applies.
The 6 buyer categories and how to identify yours
SDLT in England + Northern Ireland in 2026 falls into one of six categories, each with stacking surcharges:
1. FIRST-TIME BUYER (FTB)
- Eligibility: never owned residential property anywhere in the world; primary residence intent within 12 months
- Rates: 0% to £300,000, 5% £300-500K, standard rates £500-625K, standard from pound 1 if over £625K
- Maximum SDLT discount: about £8,750 for a £500K purchase
- Disqualifies if you own (or have ever owned) any residential property abroad
2. STANDARD RESIDENTIAL (UK resident, replacing main home or just one home)
- Rates: 0/2/5/10/12% by band
- Most common; no surcharges
3. SECOND HOME / BUY-TO-LET (UK resident with another residential property already)
- Rates: standard + 5% HRAD on entire price
- Triggered whenever the buyer (or spouse, jointly) owns another residential property at completion
- Refund possible if old main home sold within 36 months (file SDLT-LOR)
4. NON-RESIDENT STANDARD (replacing main residence, non-resident at completion)
- Rates: standard + 2% non-resident surcharge
- 183-day UK presence test (less than 183 days in 12 months before completion)
- Refund possible if buyer becomes UK resident in 12 months after completion
5. NON-RESIDENT SECOND HOME (both apply)
- Rates: standard + 5% HRAD + 2% NR = +7 percentage points
- Most expensive case; common for foreign investors buying UK rental property
6. COMPANY / CORPORATE
- Rates: 17% flat above £500,000 for residential under ATED (with reliefs); otherwise +5% HRAD + 2% NR if non-resident-controlled
- Plus annual ATED charge if held in company structure
- Generally only used for high-value, non-natural-person ownership structures
Note: spouses count as one buyer for HRAD and FTB. If your spouse owns property elsewhere, you both face HRAD on a new purchase.
| Buyer type | Base SDLT | HRAD (5%) | NR surcharge (2%) | Total |
|---|---|---|---|---|
| UK first-time buyer | £10,000 | £0 | £0 | £10,000 |
| UK standard residential | £15,000 | £0 | £0 | £15,000 |
| UK second home / BTL | £15,000 | £25,000 | £0 | £40,000 |
| Non-resident standard | £15,000 | £0 | £10,000 | £25,000 |
| Non-resident second home | £15,000 | £25,000 | £10,000 | £50,000 |
| Company / corporate | £15,000 | £25,000 | £10,000 | £50,000 + ATED |
Stacking math: worked example walkthrough
A £750,000 London flat purchased by 4 different buyer profiles to show the surcharge stack:
Buyer A: UK first-time buyer
- £750,000 over £625K so NO FTB relief; falls back to standard rates
- 0% on £125K = £0
- 2% on £125K (£125-250K) = £2,500
- 5% on £500K (£250-750K) = £25,000
- Total: £27,500. Effective rate: 3.67%
Buyer B: UK resident standard (replacing main home, single property)
- Same as Buyer A: £27,500
- Effective rate 3.67%
Buyer C: UK resident, second home / BTL
- Base SDLT: £27,500
- HRAD: 5% on £750,000 = £37,500
- Total: £65,000. Effective rate 8.67%
- Excess over Buyer B: £37,500
Buyer D: Non-resident, second home (e.g. Hong Kong investor)
- Base SDLT: £27,500
- HRAD: £37,500
- Non-resident surcharge: 2% on £750,000 = £15,000
- Total: £80,000. Effective rate 10.67%
- Excess over Buyer B: £52,500
Buyer E: Company purchase (held via Cayman LLC)
- 17% flat on £750K = £127,500 IF no relief
- WITH commercial-letting relief: same as standard rates + HRAD + NR = £80,000 + ATED annual £4,400+
The non-resident second-home buyer pays nearly THREE TIMES the standard residential SDLT on the same property. This is a deliberate policy choice to dampen overseas investment in UK housing.
Refund scenarios that reduce the bill
- Sell old main home within 36 months: reclaim the 5% HRAD via SDLT-LOR
- Become UK resident in 12 months: reclaim the 2% non-resident surcharge
- Both can be claimed simultaneously if applicable
When you can reclaim the surcharges
Two refund pathways exist; both require filing with HMRC.
1. HRAD Refund (replacing main residence)
If the new home replaces your main residence AND you sell your old main residence within 36 months of completion, the 5% HRAD becomes refundable. File SDLT-LOR within 12 months of either:
- Completion of the new home, OR
- Sale of old main home (whichever is later)
The old home must have been your "main" residence at SOME POINT in the 3 years before the new purchase. So buying a new home while your old one is on the market is NOT enough; you must have actually LIVED in it.
Worked example: Sam owns and lives in a flat. He buys a house in March 2026 to be his new home, while his flat is still on the market. He pays full SDLT + 5% HRAD on the house (£40,000 extra). His old flat sells in November 2026 (8 months later). He files SDLT-LOR and HMRC refunds the £40,000.
2. Non-Resident Surcharge Refund
If you become UK resident in the 12 months AFTER the transaction, the 2% non-resident surcharge becomes refundable. Specifically: present in UK 183+ days in any continuous 365-day period that starts up to 364 days before transaction and ends up to 365 days after.
File via amendment to the original SDLT return within 2 years of the effective date.
Worked example: A Hong Kong investor buys a London flat in January 2026 with the 2% non-resident surcharge (£15,000 on £750K). They move to the UK in February 2026 (intending to stay long-term). By February 2027, they have been in the UK 183+ days. They file SDLT-NR refund claim. HMRC refunds £15,000.
Both refunds can be combined: a non-resident second-home buyer who later (1) sells their old foreign home within 36 months AND (2) becomes UK resident within 12 months can reclaim BOTH surcharges, paying only the base SDLT.
Claim deadlines
- HRAD refund: 12 months from completion or sale of old home (whichever later)
- Non-resident refund: 2 years from effective date of transaction
Missing the window forfeits the refund permanently. Set calendar reminders.
Common SDLT mistakes for non-residents
- Assuming you have a year to sell old home. The HRAD refund window is 36 months, not 12. But the REFUND claim window is shorter (12 months from completion of new home OR sale of old, whichever later).
- Forgetting your spouse counts. If your spouse owns property elsewhere, even abroad, you face HRAD on the new UK purchase even if you personally own nothing.
- Confusing the 183-day test with the Statutory Residence Test. SDLT non-resident test is just "less than 183 days in 12 months pre-completion." SRT is more complex; SDLT does not use SRT factors.
- Not understanding that HRAD applies even to a small holiday cottage. If you own a £100K cottage in Cornwall and buy a £600K London flat, you pay HRAD on the £600K flat.
- Buying through a UK company without understanding ATED. £500K+ residential held by a non-natural-person owes ATED annual charge unless commercial-letting relief applies.
- Missing leasehold lease premium + NPV calculation. Most flats are leasehold. SDLT applies to BOTH the price paid for the lease AND to the Net Present Value of rent over the term.
- Assuming Scotland and Wales follow the same rules. They do not. Scotland uses LBTT (Additional Dwelling Supplement raised to 8% in December 2024). Wales uses LTT (higher rates from 5%). Both have NO non-resident surcharge.
- Not getting an SDLT certificate from solicitor. Without one, your solicitor cannot complete the Land Registry registration.
- Failing to file the SDLT return within 14 days of completion. £100 fixed penalty + interest on late filing.
- Thinking gift-of-property avoids SDLT. Gifts are deemed "linked transactions" with the recipient assuming the existing mortgage; SDLT applies to the assumed debt.
Run the math for your situation
Use our GB calculator to plug in your own numbers.