Figures relate to tax year 2025-26 (UK) · 2025 (US)
You find a flat, agree a price, and your solicitor sends through the stamp duty figure. It is noticeably larger than the number you worked out from the published rates.
Two separate additions explain the gap. One looks at where you lived in the year before you bought. The other looks at what else you own anywhere in the world. An SDLT surcharge can apply on its own or alongside the other.
Key takeaways
- A 2% SDLT surcharge applies to buyers who were not UK resident for stamp duty.
- A separate SDLT surcharge applies where you already own another dwelling.
- Property owned anywhere in the world counts for the second one.
- The residence test for stamp duty is its own test, not the usual one.
- The non-resident surcharge can be reclaimed if you move here afterwards.
- America gives no deduction or credit for either amount.
What is the SDLT surcharge for non-residents?
It is an SDLT surcharge of 2% on top of the ordinary rates, charged where the buyer was not resident in Britain under the stamp duty definition. According to HMRC guidance, that test looks at your days in the United Kingdom across a specific window around the purchase.
It applies to every band rather than only the top one.
So a £600,000 purchase carries £12,000 of additional charge from that layer alone.
How is residence tested here?
By day count, over a window running from a year before the purchase to a year afterwards. Spend fewer than 183 days in Britain in any continuous twelve months inside that window and the SDLT surcharge applies.
This is a stamp duty test with its own rules.
Keep a note of your arrival and departure dates as you go.
Our guide to the UK statutory residence test covers the quite different income tax version.
Can you get the 2% back?
Yes, and plenty of people do. If you go on to spend enough days in Britain in the twelve months after completion, you can apply for a refund of the non-resident element within a set time limit.
That suits somebody buying shortly before relocating here.
Set a calendar reminder for twelve months after completion.
Diarise the claim, because nobody reminds you about it.
What is the additional property surcharge?
A further SDLT surcharge charged where you already own an interest in another dwelling at the end of the day you complete. It applies whether that other property sits in Britain, America or anywhere else.
A home in Boston therefore makes a London flat an additional property.
Even a small share in another home can be enough to trigger it.
That single rule catches most American buyers who keep a house at home.
A worked example
The figures below are illustrative and use round numbers to show the mechanics.
Rachel lives in Chicago, owns her house there, and buys a £700,000 London flat before moving over.
She pays the ordinary rates, plus the additional property layer because she still owns in Chicago, plus the 2% non-resident layer because she had not yet spent enough days here.
Once she has lived in Britain for enough of the following year she reclaims the 2%. Selling the Chicago house within the permitted window could recover the other layer too.
Which layers apply to you
| Situation | Non-resident 2% | Additional property layer |
|---|---|---|
| Living abroad, first home anywhere | Yes | No |
| Living abroad, owns a home overseas | Yes | Yes |
| Living in the UK, owns a home overseas | No | Yes |
| Replacing a main home sold recently | Depends on days | Usually no |
| Buying through a company | Yes | Yes, plus other rules |
| Reclaim available later | Yes, on days | Yes, if the old home sells |
Does selling the old home help?
It can remove the additional property layer, either before you buy or within a window afterwards. Selling your previous main residence and replacing it is the usual route to avoiding that charge.
The replacement rules are specific and worth reading carefully.
The timing of the sale matters as much as the fact of it.
An American house sold at the right moment can save a substantial sum.
Does America give you anything for it?
No deduction and no credit. Stamp duty is a transaction tax rather than an income tax, so it produces nothing on your American return in the year you pay it.
What it does do is increase your cost basis in the property.
Record the figure with your purchase papers so the basis is ready later.
So it reduces the American gain when you eventually sell.
How to work out your position
- Count your days in Britain across the window around the purchase date.
- List every dwelling you or your spouse own anywhere in the world.
- Establish whether you are replacing a main residence.
- Apply the ordinary rates to the price first.
- Add the additional property layer if another dwelling remains.
- Add the non-resident layer if the day count falls short.
- Diarise any reclaim window before completion day.
What about buying with a spouse?
HMRC tests both buyers, and the SDLT surcharge applies if either of them fails. A British resident buying jointly with an American partner living abroad can still face the non-resident layer on the whole purchase.
Property owned by either spouse counts for the additional layer too.
So HMRC looks at a couple together rather than separately.
Does buying through a company help?
Rarely, and usually it makes things worse. Company purchases face their own higher rate above a threshold, the non-resident SDLT surcharge still applies, and an annual charge follows for the years you hold it.
Our guide to the enveloped dwellings charge covers the annual cost.
Price the whole holding period, not just the purchase.
An American owner also picks up company reporting on top.
What if you are buying to let?
Both forms of SDLT surcharge still apply, because they look at ownership rather than use. A buy to let counts as an additional dwelling by definition, and your plans for the property do not change the non-resident test.
The rental income then brings its own reporting on both sides.
Our guide to UK rental income on a US return covers that.
When is the money actually due?
Within a short window after completion, and your solicitor normally handles the return and the payment from the purchase funds. You will see it on the completion statement rather than receiving a separate bill.
Check that figure before exchange rather than on the day.
Surprises here arrive far too late to do anything about.
Does first-time buyer relief help?
Only if you have never owned a dwelling anywhere, which rules out most American buyers who already own at home. The relief also has its own price ceiling above which it disappears.
Owning abroad counts against you here too.
Very few cross-border buyers qualify in practice.
What about inherited property?
An inherited share can count towards the additional dwelling test, though a small inherited interest below a threshold drops out for a period. The detail matters while an estate remains in administration.
A half share in a family home is usually enough to count.
Ask the executors when the interest actually vested in you.
Check the position before exchanging rather than afterwards.
Does it apply across the whole UK?
No. Stamp duty land tax covers England and Northern Ireland only, while Scotland and Wales run their own transaction taxes with their own surcharges, their own thresholds and their own rates entirely.
The structures are similar but the numbers differ.
Check which regime applies before budgeting anything.
How long does a refund take?
Usually several weeks once the claim goes in, and you cannot claim until the day count is actually met. So the money sits with HMRC for most of a year.
Budget as though you will not get it back.
Treat the refund as a bonus rather than part of the deposit.
What counts as a dwelling?
A residential property anywhere in the world, including a share in one. Land without a building generally does not count, and neither does commercial property held purely as an investment.
A holiday home abroad counts in full.
Mixed use buildings need looking at individually.
So does a flat you let out in another country.
Does the price affect which layers apply?
Only through the thresholds. The additional property layer has a minimum price below which it does not bite at all, while the non-resident layer applies from the point ordinary duty starts to run.
Very low value purchases can escape one but not the other.
Most London purchases clear both thresholds comfortably.
What records should you keep?
Your travel history for the relevant window, the completion statement showing what you paid, and evidence of any property you owned elsewhere. Those three support both the original return and any later claim.
Boarding passes settle a borderline day count.
Keep them until the refund window has closed.
Should you time the purchase around the day count?
It can be worth a lot. Somebody relocating anyway may find that completing a few months later, once the days are banked, removes the 2% entirely rather than relying on a refund.
That has to fit the move and the chain, obviously.
But where the dates are flexible, it is free money.
Does the seller care about any of this?
Not at all. Stamp duty falls entirely on the buyer, so the surcharges never appear in a negotiation and no seller will reduce the asking price because you happen to owe more than the last buyer did.
Build the full figure into what you can afford.
Agents quote prices without any reference to it.
What if you buy before selling at home?
You pay the additional layer up front and reclaim it if the old home sells inside the permitted window. Plenty of cross-border buyers end up in exactly that sequence, because the two markets rarely line up neatly.
The window is measured in years rather than months.
Miss it and the money stays with HMRC permanently.
Diarise both reclaim deadlines on the day you complete.
Mistakes and penalties we see with an SDLT surcharge
The first is forgetting an overseas property when testing the SDLT surcharge. The additional layer looks worldwide, not just at Britain.
The second is assuming the income tax residence rules apply. Stamp duty runs its own test.
The third is missing the refund window after moving here. The money does not come back automatically.
The fourth is budgeting from the headline rates alone and finding the gap at completion.
How US UK Tax Accountants helps
We count the days properly, test both layers against your actual ownership, and tell you the real figure before you exchange. Then we diarise any reclaim so the money comes back when it can.
We also record the cost basis properly for the eventual American sale. Our UK self assessment service covers the British filings.
If you are buying in Britain from America, get in touch before you exchange. Completion day fixes the numbers, and the planning window shuts well before it.
Last reviewed 4 October 2026. This article is general information and not personal tax advice. Every purchase turns on its own facts, so take advice on yours before exchanging.
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Official guidance from the IRS, FinCEN and GOV.UK. Thresholds and rates on those pages are updated annually — check the current tax year before relying on a figure.
