Stamp Duty Land Tax Surcharge for Non-UK Residents: Rates and Guidance

SDLT 2% non-UK resident surcharge on residential property

Since 1 April 2021, an extra 2% SDLT charge can apply to certain purchases of residential property in England and Northern Ireland where a buyer is treated as non-UK resident for SDLT purposes. This is a separate SDLT residence test, not the same as nationality, visa status or general UK tax residence, and it can affect individuals, companies, partnerships and trusts.

• The surcharge applies on top of normal residential SDLT rates, and can also be added to higher rates for additional dwellings or other residential SDLT charges.
• For individuals, the main test is whether they were in the UK at the end of at least 183 days in the 12 months before the transaction’s effective date, which is usually completion unless there was earlier substantial performance.
• If there is more than one buyer, one non-UK resident buyer usually makes the whole transaction non-resident, although there is a special rule for some spouses and civil partners buying together.
• The surcharge usually applies to freeholds costing £40,000 or more and to certain leaseholds with a premium of at least £40,000 or relevant rent of £1,000 or more, but it does not normally apply to mixed-use, non-residential property or short leases.
• Companies, partnerships and trusts have special rules, including cases where a UK resident close company controlled by non-UK residents is treated as non-resident for this purpose.
• Some exclusions, reliefs and possible refunds exist, including Crown employment relief and, in some cases, a later refund for individuals who go on to meet the residence condition.

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SDLT non-UK resident surcharge on residential property in England and Northern Ireland

This page explains the 2% Stamp Duty Land Tax surcharge that can apply when residential property in England or Northern Ireland is bought by a buyer who is treated as non-UK resident for SDLT purposes. The rule can affect individuals, companies, partnerships and trusts. It uses its own residence tests, which are not the same as nationality, immigration status, or the Statutory Residence Test for income tax and capital gains tax.

What this rule is about

Since 1 April 2021, a residential land transaction can attract an extra 2% SDLT charge if it is a “non-resident transaction”. The surcharge is added on top of the normal residential SDLT rates. It can also sit on top of the higher rates for additional dwellings, company rates, or other residential charging rules.

The rule matters because a buyer can be non-UK resident for these purposes even if they plan to live in the property, and even if they have strong personal ties to the UK. The key question is not why they are buying, but whether they meet the SDLT residence test at the effective date of the transaction.

The surcharge applies only to residential transactions in England and Northern Ireland. It does not apply to land in Scotland or Wales, where different devolved taxes apply.

What the official source says

HMRC says the surcharge applies to purchases of major interests in residential property where one or more buyers is non-UK resident in relation to the transaction.

In broad terms:

• For freehold residential property, the surcharge applies where the price is £40,000 or more.
• For leasehold residential property, it applies where the lease premium is £40,000 or more or the relevant rent is £1,000 or more, provided the lease has more than 7 years to run when granted.
• A “major interest” means a freehold or leasehold interest, including an undivided share in one.
• The rule covers the dwelling and its garden and grounds, including structures such as a garage, and land that exists for the benefit of the dwelling.

The surcharge does not normally apply to:

• non-residential property
• mixed property
• leases with 7 years or less to run when granted

HMRC also says the surcharge can apply to certain off-plan purchases in some circumstances.

The residence test depends on the type of buyer:

• Individuals are non-UK resident if they were not present in the UK for at least 183 days in the 12 months before the effective date of the transaction.
• A day counts if the individual is in the UK at the end of that day.
• For these purposes, days spent anywhere in the UK count, not just in England or Northern Ireland.
• Companies are non-UK resident if they are not UK resident for corporation tax purposes at the effective date.
• Some UK resident close companies controlled directly or indirectly by non-UK residents are also treated as non-resident, unless excluded.
• For partnerships, the partners are treated as joint buyers.
• For trusts, the trustees’ residence status is generally used, unless the trust is a bare trust or one where a beneficiary has certain occupation or income rights, in which case the beneficiary position is used.

If there is more than one buyer, the general rule is severe: if any one buyer is non-UK resident in relation to the transaction, all buyers are treated as non-UK resident. There is a special relaxation for spouses and civil partners buying together, provided they are not separated and neither is acting as trustee of a settlement. In that case, if one is UK resident in relation to the transaction, both are treated as UK resident.

The effective date is usually completion, but if the contract is substantially performed earlier, that earlier date is used instead.

HMRC also identifies some situations where the surcharge does not apply, including:

• certain contracts entered into and substantially performed before 1 April 2021
• certain contracts exchanged before 11 March 2020, unless they are excluded transactions
• certain UK resident close companies such as PAIFs, some PAIF subsidiaries, UK REITs and group UK REIT members

There is also a special Crown employment rule. For the residence test, a person in Crown employment abroad is treated as present in the UK at the end of a day if they are abroad for that employment. The same extension can apply to their spouse or civil partner if they are not separated. Relief must be claimed in the SDLT return or by amendment.

What this means in practice

The practical effect is that a buyer may have to pay 2% more SDLT up front, even if they later spend enough time in the UK to satisfy the residence rule. For individuals, this can sometimes be corrected later by a refund claim.

The surcharge is added to the residential SDLT rates that would otherwise apply. It is not a separate standalone tax. So if a residential purchase already falls within another charging rule, the 2% is layered on top.

This means a buyer should not ask only, “Am I UK tax resident?” or “Do I have a visa?” Those questions do not answer the SDLT question. Instead, they need to ask whether they were physically present in the UK for at least 183 days in the relevant 12-month period before the effective date.

Joint purchases need particular care. If two friends buy together and one fails the SDLT residence test, the surcharge can apply to the whole transaction. By contrast, married couples and civil partners buying together may avoid that result if one of them meets the residence test and the conditions for the spousal rule are met.

Trust and company structures also need careful review. A UK incorporated or UK tax resident entity is not automatically safe from the surcharge. Some UK resident close companies controlled by non-UK residents are treated as non-resident for this purpose.

For leasehold transactions, the surcharge can affect both the premium and, where relevant, the SDLT charged on rent for a new lease.

How to analyse it

A sensible way to analyse the surcharge is to work through the following questions in order.

• Is the transaction within SDLT at all, rather than LBTT or LTT?
• Is the property residential, or mixed/non-residential?
• Is the interest being acquired a major interest?
• Does the £40,000 premium threshold or the rent threshold apply?
• What is the effective date of the transaction? Is there any earlier substantial performance?
• Who are the buyers for SDLT purposes: individuals, company, partners, trustees, or a combination?
• Which SDLT residence test applies to each buyer?
• If there is more than one buyer, does the “one non-resident taints all” rule apply?
• Is there a special rule for spouses or civil partners buying together?
• Is a trust involved, and if so, do the trustee or beneficiary rules apply?
• Is a company a close company controlled by non-UK residents?
• Does any exclusion or relief apply, such as Crown employment relief or one of the listed company exclusions?
• If the surcharge is payable now, could an individual later qualify for a refund?

For individuals, the critical evidence point is day counting. The question is whether the person was in the UK at the end of each relevant day. HMRC says it may look at records such as bank or card statements, diaries, rosters, mobile phone bills, utility bills, and club usage. The list is not exhaustive, and HMRC says it will weigh the quality of the evidence pragmatically.

Example

Illustration: A buyer completes on a flat in England on 1 June 2025. They have spent only 150 days in the UK between 2 June 2024 and 1 June 2025. On those facts, they are non-UK resident in relation to the transaction, so the 2% surcharge applies if the purchase is otherwise within the residential SDLT rules.

If instead they had spent 183 days or more in the UK during that 12-month period, they would be UK resident in relation to the transaction and the surcharge would not apply.

Now take a joint purchase by two unmarried friends. One spent 200 days in the UK in the relevant period, the other spent 100. Because one buyer is non-UK resident, both are treated as non-UK resident for the transaction, so the surcharge applies.

By contrast, if the buyers are married or in a civil partnership, living together and not separated, and neither is acting as trustee of a settlement, then if one spouse or civil partner is UK resident in relation to the transaction, both are treated as UK resident.

Why this can be difficult in practice

The rule looks simple, but several points can be awkward in real transactions.

First, the SDLT residence test is transaction-specific. A person may be non-resident for SDLT even if they think of themselves as UK-based, or UK resident under another tax code. The test is not based on nationality, citizenship, visa status, right to reside, or the Statutory Residence Test.

Second, the effective date can shift if there is substantial performance before completion. That can change the 12-month look-back period and therefore the residence result.

Third, joint purchases can produce surprising outcomes. A single non-resident buyer can bring the surcharge onto the whole transaction, unless the special spouse or civil partner rule applies.

Fourth, trust and company cases can be technical. The relevant residence analysis may depend on whether the trust is bare, whether beneficiaries have occupation or income rights, whether a company is close, and whether non-UK persons control it directly or indirectly.

Fifth, the refund mechanism is limited. HMRC says individual buyers may claim a refund if they later meet the residence condition within the allowed period. But if there is more than one buyer, refunds are available only if all buyers are individuals and all satisfy the rule, even though the 365-day qualifying period can differ for each person.

Finally, evidence can be an issue. Many buyers do not keep a day-by-day travel log. Where the 183-day count is close, assembling reliable supporting material may be important.

Key takeaways

• The 2% non-UK resident surcharge applies to certain residential purchases in England and Northern Ireland and is added to the normal residential SDLT rates.
• The SDLT residence test is its own test. For individuals, the main question is whether they were in the UK at the end of at least 183 days in the 12 months before the effective date.
• Joint purchases, trusts, companies and early substantial performance can all change the result, and some individual buyers may later be able to reclaim the surcharge by amending the SDLT return.

This page was last updated on 24 March 2026

Useful article? You may find it helpful to read the original guidance here: Stamp Duty Land Tax Surcharge for Non-UK Residents: Rates and Guidance

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