News · United Kingdom
Stamp duty surcharge: what the 5% additional property rate means for expats
The additional property surcharge rose from 3% to 5% at the 2024 Budget. For a British expat buying a UK investment property, it stacks with the 2% non-resident surcharge, and together they now account for the majority of the stamp duty bill.
How the charges stack
A non-resident buying an additional residential property pays standard stamp duty, plus 5% on the whole price, plus 2% on the whole price. On a £250,000 purchase that is £2,500, £12,500 and £5,000 respectively, totalling £20,000.
Why it matters more than it looks
Stamp duty is a sunk cost paid on day one, which means it dilutes the return on every pound you put in. A calculation based on the deposit alone will flatter the deal; a calculation based on total cash invested is the honest one.
What you can do about it
- Plan for it from the outset. On an off plan purchase there is usually a whole construction period to set the money aside.
- If you return to the UK within twelve months of completing, the 2% non-resident portion can generally be reclaimed.
- Check whether the property sits in England, Scotland or Wales, since each operates a different tax with different rates.
Our guide to investing in UK property from abroad works through the full cash requirement.
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Open the plannerGeneral information only, not financial, tax or legal advice. Rules and rates change and your own position depends on your circumstances. Take qualified advice before acting.