Answers · UK 2025/26
How does additional dwellings supplement work?
The additional dwellings supplement is the 5% SDLT surcharge added to the standard rates when you buy a second residential property in England or NI. It applies if at the end of the day of completion you own more than one residential property worth £40,000 or more and have not replaced your main home.
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The surcharge — 5% from 31 October 2024 (up from 3%) — sits on top of the standard SDLT bands and is charged on the entire purchase price, not just the portion above £40,000. Example: £300,000 buy-to-let — standard SDLT £2,500 + surcharge 5% × £300,000 = £15,000 + £2,500 = £17,500 total. Triggers: buy-to-lets, holiday homes, joint purchases where any buyer already owns a home anywhere in the world, and a married couple is treated as one unit. Refund route: if you buy a new main home before selling the old one, you pay the surcharge upfront but can reclaim it from HMRC if you sell the previous main home within 36 months (3 years from purchase). Use HMRC form SDLT16 or the online reclaim service. Inherited properties: a property inherited in the last three years and worth 50%+ owned does not trigger the surcharge until that threshold is breached. Scotland equivalent: Additional Dwelling Supplement at 8%. Wales: Higher Residential Rates of LTT.
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This answer is informational only and does not constitute financial, tax or legal advice. Figures are for the 2025/26 UK tax year. See our methodology and sources.