Stamp Duty on a Second Home: The 5% Surcharge Explained (2025/26)

If you’re buying a buy-to-let or a second home, the Stamp Duty bill is bigger than for a normal home move — sometimes much bigger — because of the additional-property surcharge. Here’s how it works so there are no surprises.

The second-home surcharge

When you buy an additional residential property in England — a second home, holiday home or buy-to-let — you pay the standard Stamp Duty Land Tax (SDLT) plus a surcharge on the whole purchase price.

For purchases completing from 31 October 2024, the surcharge is 5% (up from 3%). It’s charged on the entire price, not just the portion above a threshold, which is what makes it sting.

Our free Stamp Duty calculator works out the full bill including the surcharge instantly.

A worked example

Say you buy a £300,000 buy-to-let:

• You pay the standard SDLT that applies to the price bands, plus
• A 5% surcharge on the full £300,000 = £15,000 on top

So the surcharge alone adds £15,000 to your costs — a number that can make or break a deal’s numbers, and one to factor in before you offer.

Who has to pay it?

The surcharge applies if, at the end of the purchase, you own more than one residential property and you’re not replacing your main residence. Key points:

• It counts property you own anywhere in the world
• It applies even to a small share in another property (above £40,000)
• Most companies buying residential property pay it too

When it doesn’t apply — and refunds

There are two important reliefs:

• Replacing your main home: if you’re selling your current main residence and buying a new one, the surcharge doesn’t apply — even if you own buy-to-lets as well.
• Refunds: if you buy your new main home before selling the old one (so you briefly own two), you pay the surcharge but can reclaim it if you sell the previous main residence within 3 years.

Part of the bigger buy-to-let picture

The stamp duty surcharge is just one of the costs of building a property portfolio — alongside Section 24 on your mortgage interest and tax on your rental profit. It’s also a key factor when weighing up whether to buy through a limited company, since companies face the surcharge too.

Get the numbers right before you buy

A miscalculated Stamp Duty bill can wreck a deal’s returns. Use our Stamp Duty calculator for the figure, and our accountants for landlords to plan the whole purchase tax-efficiently — including whether personal or company ownership works out better once stamp duty, mortgage relief and CGT are all considered.