Stamp duty land tax (SDLT) is payable on the purchase of property in England and Northern Ireland; Scotland and Wales levy their own taxes for property purchases in those countries.
The UK government wants to tackle the perceived problem of overseas buyers acquiring homes in the UK which are rented out or barely used. It is thought that these purchasers are less price-sensitive than UK buyers and exacerbate house price inflation.
To discourage such buyers a 2% SDLT surcharge will be imposed on non-UK residents purchasing residential property. This will apply from 1 April 2021 in addition to the 3% surcharge where the buyer is either not going to use the property as their main home or is a company. At the high end of the market, a purchaser buying a property for over £1.5m would pay 17% of the price as SDLT.
The government says the money raised by this SDLT surcharge will be used to address the problem of rough sleeping.
However, UK residents trying to purchase a home could be caught by this surcharge. Where one or more of the purchasers are non-resident the 2% surcharge will apply. This could catch UK citizens returning to live in the UK or couples where one person works abroad.
