Buying a second home: SDLT, ADS and LTT higher rates

The three regimes compared

England and Northern Ireland: SDLT higher rates

GOV.UK says the higher rates apply when you buy a residential property, or part of one, for £40,000 or more, if all of these apply: it will not be the only residential property worth £40,000 or more that you own or part own anywhere in the world; you have not sold or given away your previous main home; and no one else has a lease on it with more than 21 years left.

The rates on GOV.UK from 1 April 2025 are 5% up to £125,000, 7% to £250,000, 10% to £925,000, 15% to £1.5 million and 17% above. These equal the standard rates plus 5 points. GOV.UK’s update history records the change of higher rates on 31 October 2024.

Our calculation, £300,000. 5% of £125,000 (£6,250) + 7% of £125,000 (£8,750) + 10% of £50,000 (£5,000) = £20,000, against £5,000 at the standard rates.

Couples. The rules apply to each buyer and their spouse as if you were buying together. If any one of you has to pay the higher rates, you pay them for the whole transaction.

Scotland: the Additional Dwelling Supplement

Revenue Scotland: for transactions on or after 5 December 2024, “the ADS is 8% of the purchase price”. It is added to the ordinary LBTT. The rate was 6% for contracts entered into on or before 4 December 2024, even if the effective date is later.

ADS applies when you buy a residential property in Scotland and already own one or more residential properties, and you are not replacing your only or main residence. It does not apply if you own only one dwelling at the effective date, if the price is under £40,000, or if your other property (or your share of it, from 1 April 2024) is worth less than £40,000. Most purchases by companies and some trusts are subject to ADS even without another property.

Our calculation, £300,000. ADS: 8% × £300,000 = £24,000, on top of the LBTT of £4,600 (£2,100 + £2,500 on the standard bands).

Wales: higher residential rates

The Welsh Government lists the higher residential rates on or after 11 December 2024 as 5% (up to £180,000), 8.5% (£180,000 to £250,000), 10% (£250,000 to £400,000), 12.5% (£400,000 to £750,000), 15% (£750,000 to £1.5 million) and 17% above. They do not apply where contracts were exchanged before that date. Companies also pay them on property of £40,000 or more, unless a lease with more than 21 years left applies.

Our calculation, £300,000. £9,000 + £5,950 + £5,000 = £19,950.

Replacing your main home, and refunds

• England and NI: if you still own your old home at the end of the day you buy the new one, the higher rates apply. If you then sell or give away your previous main home within 3 years, you can apply for a refund of the higher-rate part. No refund is possible if you or your spouse still own any part of it. For sales after 29 October 2018, the claim must be made within 12 months of the later of the sale or the filing date of the new return.
• Scotland: no ADS if you disposed of your only or main residence within the replacement window, which is 36 months for effective dates from 1 April 2024 (18 months before). A refund requires that you sold the previous property within the window, that it was your only or main residence, and that you live in the new one as your main residence.
• Wales: you usually avoid the higher rates if the new home is your main home and you have sold your last main home before, or on the same day. If you sell within 3 years afterwards you can usually claim a refund of the difference between the higher and main rates.

Which professional to consult

A conveyancer or solicitor tells you which regime applies, claims any exemption and files the refund. See the conveyancer. To model the main-rate part of your bill, use the stamp duty calculator.