How Much SDLT Do I Pay on a Second Home in 2026-27?
Second-home buyers pay SDLT at 5% to 17% because a 5% additional dwelling surcharge is added to every band. On a £500,000 second home, that is £40,000.
Short answer: Buying an additional dwelling (a second home or buy-to-let) in England or Northern Ireland attracts SDLT at 5% on the first £125,000, 7% to £250,000, 10% to £925,000, 15% to £1.5m and 17% above — because a 5% additional dwelling surcharge (ADS) is added to every standard residential band. On a £500,000 second home, the SDLT is £40,000.
How the surcharge works
The additional dwelling surcharge adds 5 percentage points to each residential SDLT band. It applies whenever you buy a residential property that is not a replacement for your main residence. The surcharge increased from 3% to 5% for transactions with an effective date on or after 31 October 2024.
Worked example: £500,000 second home
| Band | Amount | Rate | SDLT |
|---|---|---|---|
| £0 – £125,000 | £125,000 | 5% | £6,250 |
| £125,001 – £250,000 | £125,000 | 7% | £8,750 |
| £250,001 – £925,000 | £250,000 | 10% | £25,000 |
| Total | £40,000 |
For comparison, the same property bought as a main residence would attract roughly £15,000 of SDLT — so the surcharge adds £25,000.
Can I get a refund?
Yes. If you buy a new main residence before selling your old one, you pay the surcharge upfront but can reclaim it within three years if you sell your previous main residence within that window. This is the replacement-of-main-residence rule, and it is one of the most commonly missed SDLT refunds.
What about non-UK residents?
Non-UK resident buyers pay an additional 2% surcharge on residential property on top of the standard and ADS rates — so a non-resident buying a second home can face SDLT of up to 19%.
Legislation
The higher rates for additional dwellings are in Schedule 4A, Finance Act 2003, as amended by the Finance Act 2025 provisions announced at the October 2024 Budget. The replacement-of-main-residence rules are in Schedule 4A, paragraphs 5–9.
How Newshams can help
Newshams Tax Advisers provides specialist SDLT planning and refund recovery for second-home and portfolio buyers across the UK. Contact us on +44 (0) 800 211 8657 or enquiries@newshams.com.
Frequently Asked Questions
Can I reduce my SDLT liability?+
Yes. There are several SDLT reliefs and exemptions that can legitimately reduce your liability, including multiple dwellings relief, group relief, and relief for certain property transactions. Specialist advice is key to identifying which apply.
When should I seek specialist SDLT advice?+
You should seek specialist SDLT advice on any commercial or mixed-use property transaction, where multiple dwellings relief may apply, on lease transactions, and wherever the SDLT liability is significant.
What is multiple dwellings relief?+
Multiple dwellings relief (MDR) allows buyers of two or more dwellings in a single transaction to calculate SDLT based on the average price of the dwellings rather than the total, which can significantly reduce the tax payable.
Simon Newsham CTA
Chartered Tax Adviser — Founder, Newshams Tax Advisers
Simon Newsham is a Chartered Tax Adviser (CTA) with over 30 years' experience advising businesses, high net worth individuals, law firms and accountancy practices on complex UK tax matters. He has been advising clients since 1995 and is a member of the Chartered Institute of Taxation.
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