Changes to Stamp Duty: Non-UK Resident Surcharge

The introduction of the non-UK resident surcharge means that, for the first time from 1st April 2021, solicitors will have to consider the concept of residence for clients which means they will need to obtain more information when filling out an SDLT return form.

The measure introduces new rates of Stamp Duty Land Tax (SDLT) for purchasers of residential property who are not resident in the United Kingdom.  The new rates will be 2% higher than those that apply to purchases made by UK residents, and will apply to purchases of both freehold and leasehold property as well as increasing SDLT payable on rents on the grant of a new lease.

The new measure will apply to land transactions with an effective date of 1st April 2021 or later.    Where contracts are exchanged prior to 11 March 2020 but complete or are substantially performed on or after 1st April 2021, transactional rules may apply.    Transitional rules may also apply where a contract is substantially performed on or before 31st March 2021 but does not complete until 1st April 2021 or later.

Who is likely to be affected?

This measure will affect individuals who will be required to consider their residence status when purchasing a residential property.  Most individuals will be clear as to their residence status for the purposes of SDLT but some individuals with more complex affairs or who have regular periods in and out of the UK may require additional advice and incur additional costs in determining their tax liability.  Where individuals pay the surcharge but then satisfy the residence conditions in the 12 months following the transaction, they may be entitled to a refund.


For more information please speak with one of our residential conveyancing team who will be able to assist.

Vicky Middleton