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Stamp Duty on buy to let properties

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Do you pay Stamp Duty on buy to let properties?

If you’re looking to purchase a buy to let property, you may be required to pay an additional rate for Stamp Duty Land Tax (SDLT).

The amount you pay will vary depending on the price of your property and how many other properties you have. Read on to find out more about paying Stamp Duty on buy to let properties.

How does Stamp Duty apply to landlords?

In England and Northern Ireland, landlords are required to pay Stamp Duty on investment properties worth over £40,000.

If you’re a landlord purchasing a buy to let property, you’ll be required to pay a minimum 3% extra charge. You’ll need to pay this alongside any regular Stamp Duty fees.

The surcharge is applied when you buy a house in addition to one you already own. So, you won’t pay this surcharge if you only own one property. The amount you pay will depend on the value of the home. Typically, the higher the value the more expensive the tax.

We break down buy to let Stamp Duty rate thresholds below.

What Stamp Duty fees will a landlord pay?

The rates that landlords have to pay for Stamp Duty on buy to let (BTL) properties can vary across the UK. Different rules apply for Scotland and Wales.

Here’s the current rates for Stamp Duty on investment properties in England and Northern Ireland:

 

Property price

Stamp Duty rate

Stamp Duty rate for BTL

Up to £250,000

0%

3%

£250,000 - £925,000

5%

8%

£925,001 - £1.5 million

10%

13%

£.1.5 million +

12%

15%

 

For buy to let Stamp Duty rates in Scotland and Wales, visit:

Stamp Duty BTL rates in Scotland

Stamp Duty BTL rates in Wales

Do you pay Stamp Duty on a second home?

You’re required to pay additional Stamp Duty on a second home if its value exceeds £40,000, whether you are planning to rent it out or use it yourself.

For example, if your second home costs £260,000, you’ll pay 13% Stamp Duty in total.

A second home is defined as any property that you purchase in addition to your main residence. This includes buy to lets, holiday homes and properties purchased as a gift.

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Buying a property if you’re not a UK resident

Are any properties exempt from buy to let surcharges?

There are a few exemptions where you not have to pay Stamp Duty. These include:

  • it’s a caravan, motorhome or houseboat
  • it’s a freehold property with a value of £40,000 or less
  • the property was left to you in a will
  • you become the owner through divorce or dissolution of a civil partnership
  • you buy a lease for seven years or more. This must be for less than £40,000 with the annual rent below £1,000.

If you think you’ve been incorrectly charged for Stamp Duty, you could claim it back. Just gather all your paperwork and fill out the government’s online SDLT repayment form.

Buy to let Stamp Duty: FAQs

Looking for a buy to let mortgage?

We aren't currently offering buy to let mortgages directly through NatWest, though you may be able to apply through a mortgage broker. We regularly review the mortgages we offer. Please check back at a later date, when we hope to be able to provide you with a buy to let mortgage.