What is the 2% non-resident stamp duty surcharge?

Full answer

The 2% non-resident surcharge is an additional rate of Stamp Duty Land Tax (SDLT) introduced in April 2021. It applies when a non-UK resident purchases residential property in England or Northern Ireland. Scotland (LBTT) and Wales (LTT) have their own systems and are not covered by this surcharge. How it works: the 2% is added to whatever SDLT rate would otherwise apply in each band. It stacks on top of standard residential SDLT and, where relevant, the additional-property surcharge for second homes and buy-to-let. So a non-resident buying an additional property pays standard SDLT plus the additional-property surcharge plus this 2%, all calculated band by band on the price. Who counts as non-resident. For individuals the test is based on days spent in the UK: broadly, you are treated as non-resident for the surcharge if you were present in the UK on fewer than 183 days in the 365 days ending on the purchase date. The test differs from the Statutory Residence Test used for income tax. Companies and certain other entities have their own non-resident rules. The refund mechanism is valuable. The surcharge is assessed by reference to a 365-day window before and a 365-day window after completion. If you were non-resident at purchase but then spend enough days in the UK to meet the residence test within the year after buying, you can apply to HMRC for a refund of the 2%, normally within two years of the transaction. For specific SDLT band thresholds and rates - which change from time to time and are not reproduced here - check gov.uk or use the stamp duty calculator, which should let you flag non-resident and additional-property status so the surcharges are layered correctly. This affects overseas buyers, expats returning to the UK, and non-resident investors. Because the residence test and refund timing are technical, keep travel records and consider professional advice on a large purchase.

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