Stamp Duty Land Tax (SDLT)
Stamp Duty Land Tax is a tax paid to HMRC when buying property or land in England and Northern Ireland. For landlords, the key point is that most purchases of rental property attract higher rates than buying a main home. Since 2016, an additional percentage, often called the “3% surcharge” has usually applied to purchases of additional dwellings, including most buy-to-lets, above the normal SDLT thresholds.
SDLT is a one off upfront cost based on the purchase price, not an annual charge. It is normally paid within a short deadline after completion via your conveyancer. The exact bands and rates can change through the UK Budget, so landlords should always check the latest HMRC guidance or seek tax advice before exchanging contracts.
From a renter’s perspective SDLT does not change your legal rights under housing law or the Renters’ Rights Act. It is a cost of doing business for the landlord, rather than a “fee” that can be passed directly to you. However, SDLT can indirectly influence landlords’ decisions about buying, selling or restructuring property portfolios, which in turn may affect the supply and pricing of rental homes in a local area. Also see Capital Gains Tax (CGT)
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