Non-Resident Stamp Duty
The 2% surcharge for overseas buyers explained.
In this article
Key Takeaways
- Non-UK residents pay an additional 2% SDLT surcharge on residential property purchases in England and Northern Ireland, introduced in April 2021 to support domestic buyers.
- The 183-day presence test determines UK residence status. You must be physically present in the UK for at least 183 days in the 12 months ending with the completion date to avoid the 2% surcharge.
- Non-resident buyers purchasing additional properties face a combined 7% surcharge, 2% non-resident surcharge plus 5% additional property surcharge, on top of standard SDLT rates.
- A £500,000 property purchase by a non-resident buying their only property costs £18,250 in SDLT compared to £8,750 for a UK resident. The 2% surcharge adds £10,000 to the bill.
- Non-resident refunds are possible if you become UK resident within 2 years of purchase and live in the property as your main residence. You must claim within 12 months of meeting the conditions.
- Companies incorporated outside the UK always pay the 2% non-resident surcharge, even if directors or shareholders are UK residents. Company residence is determined by incorporation location and central management.
- Joint purchases where any buyer is non-resident trigger the 2% surcharge on the entire property. One non-resident partner means both parties pay the higher rate.
- Scotland and Wales have equivalent non-resident surcharges under LBTT and LTT respectively. Scotland charges 6% ADS (4% higher than England) which applies to both non-residents and additional properties.
+2%
Surcharge rate
183 days
UK presence test
+5%
If also additional
Refund
Possible in 2 years
What is the Non-Resident Surcharge?
Since April 2021, non-UK residents pay an additional 2% on top of all other SDLT rateswhen purchasing residential property in England and Northern Ireland. Use our non-resident calculator to find your exact cost. This is designed to help level the playing field for UK residents.
2% Non-Resident Surcharge
The 2% non-resident surcharge applies on top of ALL other rates, including the standard SDLT bands and the 5% additional property surcharge (if applicable). This means non-residents can face multiple layers of charges:
- Non-resident buying main residence: Standard rate + 2% NR surcharge
- Non-resident buying second home/BTL: Standard rate + 5% additional dwelling surcharge + 2% NR surcharge = 7% total surcharge
Introduced April 2021
The non-resident surcharge was introduced on 1 April 2021 as part of measures to support UK residents in the property market. Properties purchased before this date were not subject to the 2% surcharge, even if the buyer was non-UK resident.
How UK Residence Is Determined
UK residence for stamp duty purposes is determined by the 183-day test. You're considered UK resident if you have been present in the UK for at least 183 days during any continuous 365-day period in the 12 months ending with the day before completion.
The 183-Day Test Explained
Look at the 12 months before your purchase completion date. Within those 12 months, find any rolling 365-day period where you were in the UK for 183+ days:
- UK Resident: You met the 183-day threshold in at least one 365-day period
- Non-Resident: You did not meet the 183-day threshold in any 365-day period
What Counts as "Present in the UK"?
You're counted as present on any day when you are in the UK at the end of the day (midnight). The rules are:
- Days of arrival: Count if you arrive before midnight and are still in the UK at midnight
- Days of departure: Count if you were in the UK at midnight the night before
- Transit days: Count if you were in the UK at midnight (even if just passing through)
- Partial days: Any part of a day where you're in the UK at midnight counts as a full day
Different from Income Tax Residence
The SDLT residence test is separate from UK income tax residence rules. You could be UK resident for income tax but non-resident for SDLT (or vice versa). HMRC only looks at physical presence in the UK for SDLT purposes - factors like home location, work ties, and family ties (used for income tax) are irrelevant.
Non-Resident Refund
You Can Reclaim the 2% Surcharge
If you become UK resident within 2 years of purchasing the property, you can claim a full stamp duty refund of the 2% non-resident surcharge. To qualify, you must spend 183+ days in the UK during any 365-day period within 2 years of completion.
Claim deadline: You must claim within 2 years of the date you meet the 183-day test, or within 12 months of filing your SDLT return (whichever is later). Claims are made by amending your original SDLT return.
Example scenario: You complete purchase on 1 March 2025 while living abroad (pay 2% surcharge). You move to the UK on 1 July 2025. By 1 January 2026, you've accumulated 183 days of UK presence in the rolling 365-day period. You can now claim back the 2% surcharge, with a deadline of 1 January 2028 (2 years from meeting the test).
Worked Example: Non-Resident Buying £400,000 Property
Let's compare the stamp duty for a £400,000 property across three buyer scenarios: UK resident buying first home, UK resident buying additional property, and non-resident buying additional property.
UK Resident
First Home
UK Resident
Additional Property
Non-Resident
Additional Property
Breakdown of Non-Resident Additional Property SDLT
- Standard SDLT: £10,000
- + 5% additional property surcharge: £20,000
- + 2% non-resident surcharge: £8,000
- = Total SDLT: £38,000 (9.5% of purchase price)
British Expats Returning to the UK
A common scenario involves British expats who buy a UK property while still living and working abroad, intending to return in the future. This creates a challenging situation:
Typical Expat Scenario
You're a British citizen working in Dubai, Singapore, or the USA. You want to buy a UK property to live in when you return, but you're still living abroad at the time of purchase. You also keep your overseas property. This means:
- 5% additional property surcharge applies: Because you own the overseas property
- 2% non-resident surcharge applies: Because you haven't spent 183 days in the UK
- Total surcharge: 7% on top of standard rates
Good News: You Can Reclaim Both Surcharges
When you move back to the UK:
- Once you accumulate 183 days of UK presence (within 2 years of purchase): Claim back the 2% non-resident surcharge
- If you sell your overseas property within 36 months of UK purchase: Claim back the 5% additional property surcharge
This means an expat who pays £38,000 SDLT on a £400,000 property (with both surcharges) can potentially reduce it to £10,000 by becoming UK resident and selling the overseas property within the allowed timeframes.
Companies and Non-Residence
Corporate Buyers: Different Rules
When a company (UK or foreign) buys residential property over £500,000, the rules change entirely:
- Companies pay a flat 17% rate on the entire purchase price (for properties over £500k)
- The 2% non-resident surcharge does not apply to companies (already built into the 17% rate)
- The 5% additional property surcharge does not apply separately (included in the 17%)
- Company residence status is irrelevant for properties over £500k - all companies pay the same flat rate
Example: A foreign company buying a £750,000 UK residential property pays £127,500 (17% flat). A non-UK resident individual buying the same property (as additional property) would pay £65,000 + £15,000 = £80,000. The company route is significantly more expensive for stamp duty purposes.
Who is a "Non-Resident"?
You're treated as non-UK resident if you haven't been present in the UK for at least 183 days in any continuous 365-day period during the 12 months before purchase.
The 183-Day Test
Look at the 12 months before your purchase date:
- UK Resident: Present in UK for 183+ days in any 365-day period
- Non-Resident: Not present for 183+ days in any 365-day period
"Present" means being in the UK at the end of the day (midnight). Days of arrival and departure can count depending on your other days of presence.
How the 2% Adds Up
The 2% surcharge stacks with other rates. Here are the combined rates for non-residents:
| Band | Main Home | Additional (+5%) |
|---|---|---|
| £0 - £125,000 | 2% | 7% |
| £125,001 - £250,000 | 4% | 9% |
| £250,001 - £925,000 | 7% | 12% |
| £925,001 - £1,500,000 | 12% | 17% |
| Over £1,500,000 | 14% | 19% |
Example Calculations
| Property | UK Resident | Non-Resident | Extra Cost |
|---|---|---|---|
| £300,000 main home | £5,000 | £11,000 | +£6,000 |
| £500,000 main home | £15,000 | £25,000 | +£10,000 |
| £500,000 second home | £40,000 | £50,000 | +£10,000 |
| £1,000,000 second home | £73,750 | £93,750 | +£20,000 |
Can You Get a Refund?
Yes - If You Become UK Resident
You can claim back the 2% surcharge if you spend 183 days or more in the UK during any 365-day period in the 2 years after purchase.
Claim deadline: Within 2 years of the date you meet the 183-day test, or 12 months from the SDLT filing date (whichever is later).
Joint Purchases
One Non-Resident = Surcharge Applies
If you're buying with someone else and any buyer is non-UK resident, the 2% surcharge applies to the whole purchase. It doesn't matter if one buyer is UK resident - the surcharge still applies in full.
Scotland and Wales
Scotland and Wales don't have a non-resident surcharge. If you're buying property there, you'll pay the same LBTT (Scotland) or LTT (Wales) rates as UK residents. See our Scotland guide and check current rates.
However, you'll still face the Additional Dwelling Supplement (Scotland: 8%) or separate higher residential rates (Wales: starting at 5%) if it's an additional property.
Frequently Asked Questions About Non-Resident Buyers
Do expats pay extra stamp duty when buying UK property?
Yes. British expats living abroad are treated as non-UK residents for stamp duty purposes and must pay an additional 2% surcharge on top of all other rates. If the expat also owns property abroad (or in the UK), they face the 5% additional property surcharge too, meaning a total 7% in surcharges. For example, an expat buying a £400,000 UK property as a second home pays £38,000 stamp duty (vs £10,000 for a UK resident buying their first home). However, expats can reclaim the 2% if they move back to the UK and accumulate 183 days within 2 years of purchase.
How do I prove UK residence for stamp duty purposes?
You must demonstrate you spent 183 days or more in the UK during any rolling 365-day period in the 12 months before completion. Evidence includes: passport stamps, flight tickets, hotel/accommodation records, work attendance records, bank statements showing UK transactions, utility bills, or GP/NHS records. The test is based purely on physical presence in the UK - where you work, pay tax, or have family is irrelevant. You're counted as "present" on any day where you were in the UK at midnight, including arrival and departure days.
Can I get a refund if I move to the UK after buying?
Yes. If you become UK resident within 2 years of purchasing the property (by accumulating 183 days of UK presence in any 365-day period), you can claim a full refund of the 2% non-resident surcharge. You must claim within 2 years of meeting the 183-day test, or within 12 months of filing your SDLT return (whichever is later). The refund is claimed by amending your original SDLT return. For a £500,000 property, this means reclaiming £10,000. The refund typically takes 4-6 weeks to process once claimed.
How much extra stamp duty do non-residents pay?
Non-residents pay an extra 2% on the entire purchase price for any residential property in England or Northern Ireland. This stacks with other charges: if buying a main residence, you pay standard rate + 2%. If buying a second home or buy-to-let, you pay standard rate + 5% additional property surcharge + 2% non-resident surcharge = 7% total surcharge. For example, on a £300,000 second home, the non-resident surcharge alone adds £6,000 (from £20,000 to £26,000 total SDLT). Scotland and Wales have no non-resident surcharge.
Does the 2% surcharge apply in Scotland and Wales?
No. The 2% non-resident surcharge only applies in England and Northern Ireland. Scotland and Wales operate their own land transaction tax systems (LBTT and LTT respectively) and have chosen not to implement a non-resident surcharge. Non-UK residents buying in Scotland or Wales pay exactly the same rates as UK residents. However, if buying an additional property in Scotland, you'll still pay the 8% Additional Dwelling Supplement. In Wales, you'll pay the higher residential rates (starting at 5% surcharge) if it's an additional property.
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Emma Richardson, MRICS
Chartered Surveyor & Property Tax Specialist
Emma Richardson is a RICS-qualified Chartered Surveyor with over 12 years of experience in UK property taxation. She founded Stamp Duty Calculator to help buyers understand the complex world of property transaction taxes.