As of October 31st, 2024, the Stamp Duty Land Tax (SDLT) surcharge on second homes has risen from 3% to 5% above standard residential rates. This new rate is aimed at slowing down purchas- es of additional properties and could impact individuals who are in the process of selling their first property after acquiring their new main residence.
Who Does This Impact?
• Anyone buying a second home or additional property, including those who haven’t sold their old primary residence yet.
• Those who have signed contracts before October 31st, 2024, can still benefit from the old rate if certain rules are met.
Signed a Contract Before October 31, 2024?
If you signed a contract before this date but the sale completes after, you may still be eligible for the 3% sur- charge rate if:
• No major changes are made to the contract after October 30th, 2024.
• There are no added clauses or rights assigned to someone else.
Effective Dates & Rates
• Contracts with Completion Between October 31st, 2024, and March 31st, 2025: The higher rates will apply at 3% above the current residential rates that apply between 23rd September 2022 and 31st March 2025.
• Contracts Completing After April 1st, 2025: The new 5% rate will apply to the permanent residential rates.
Consult With Your Adviser
For a second home costing £200,000, the stamp duty will now be £10,000 at the new 5% rate, up from £6,000 at the previous 3% rate. This increase in SDLT could impact anyone buying an additional property after October 31st, 2024, so plan ahead and consult with a taxation specialist if you’re in the process of buying an additional property.
For more information on Stamp Duty, visit the GOV.UK page – https://www.gov.uk/stamp-duty-land-tax
If you’d like to discuss the options available to you, contact our friendly team at FX Mortgages today.
