Know about the Stamp duty for Buy-To-Let Property

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With the UK government abolishing stamp duty for first-time house buyers in Wales and England, investing in England- and Wales-based properties is a lucrative option for property investors. 

For first-time homebuyers in Wales and England buying houses up to £300,000, the Budget 2017 removed stamp duty, saving first-time purchasers up to $5,000. 

In addition, first-time purchasers who spend up to £500,000 only have to pay stamp duty at a rate of 5% on the sum over £300,000. Over £500,000 in purchases will result in full stamp duty payment.

For the uninitiated, a tax known as stamp duty is assessed on individual real estate transactions and papers. It includes most legal documents like receipts, cheques, military commissions, land transactions, and marriage certificates. 

Back in the day, before a document could be legally bound, a tangible revenue stamp should have been affixed to it. The physical stamp is no longer necessary for more recent versions of the tax.

If you want to learn more about stamp duty, stamp duty for a buy-to-let property, and more, continue reading. 

Key takeaways: 

  • First-time property investors in the UK have to pay no stamp duty if the property investment is under £300,000. 
  • First-time buy-to-let investors have to pay a nominal stamp duty fee. 
  • An additional stamp duty fee is to be paid by perpetual investors. However, there are certain exceptions. 

New rates of stamp duty for buy-to-let property

When purchasing a home you do not plan to reside in for most of the time, such as a vacation/second home or a buy-to-let property, you will have to spend an additional 3% on stamp duty.

The only exception to this rule is first-time buyers engaging in buy-to-let real estate who will pay conventional house mover rates because they have never owned a home before.

Like income tax and residential stamp duty rates, stamp duty buy-to-let rates are tier-based

Do I need to pay additional buy-to-let stamp duty?

There are various terms and conditions involved regarding additional buy-to-let property stamp duty. Let us eliminate the confusion by having a look at the various aspects of stamp duty surcharge: 

  1. Stamp duty surcharge applicability 

Residential property purchasers in Northern Ireland and England who are based abroad must now add a 2% premium to the standard rates as of April 2021.

In addition to the 3% buy-to-let surcharge, foreign nationals investing in property will have to pay 5% more in stamp duty than typical UK home movers.

Irrespective of the number of properties you own, you will be required to pay the additional stamp duty if you are in a civil partnership or are married and either companion possesses a property.

Regardless of the number of properties the corporation owns, the additional stamp duty will apply if an individual does not do the transaction (e.g., the purchaser is a corporation rather than a person).

  1. Exemptions from stamp duty surcharge 

There will be no stamp duty due if the total amount spent on the property is under £40,000. 

Irrespective of the purchase cost or whether it will serve as your primary dwelling, purchasing a caravan, houseboat, or mobile home will also exempt you from paying stamp duty.

You won’t be required to pay the buy-to-let stamp duty rates if you have never owned a home before and are buying a buy-to-let property. 

The first-time purchaser stamps duty exemption/discount is only available to persons who intend to dwell in the property. Thus, you are ineligible for it as well.

First-time buyers will instead be required to pay the usual homeowner stamp duty rates when buying a buy-to-let property.

Some other instances where you can save on any or additional stamp duty buy-to-let are as follows: 

  1. Married couples living apart 

As has been iterated earlier, individuals in a civil partnership or marriage are regarded as a single entity for stamp duty.

However, the only situation in which this is not true is when spouses are living apart and unlikely to reconcile.

  1. Sole buyer in an unmarried relationship 

The only method to avoid having to pay higher stamp duty in an unmarried relationship is for the partner without the home to purchase the home independently. Being the sole individual listed on the property and mortgage deeds supports the surcharge exemption.

  1. A certain case of house moving 

Surcharged let-to-buy stamp duty comes into the picture when you sell your old property to buy a new one. However, you can avoid the additional stamp duty rates by selling the initial home within three years of purchasing the new one.  

  1. Holding a stake in a property financially

If you own a financial stake in another property as a partner or a trust beneficiary, or if you inherited a minor share—50% or less—of another property, it’s improbable that extra stamp duty will be imposed.

Get the Best Buy-to-let Deals in the UK with Pluxa Property 

It is the right time for first-time investors to invest in properties across the UK with the removal of stamp duty for first-time home buyers. 

Even if you have little experience with the UK real estate market, we at Pluxa Property can still assist you in making good money.

With our simple, user-friendly approach, we can assist you in finding the ideal area to invest in UK-based properties, whether you’re a first-time buyer or looking to diversify your portfolio. 

We work hard to negotiate the best price for you, and our goal is to find the perfect property for all your needs. We work with attorneys, take care of all the paperwork, and help you save time.

Get in touch with us to secure the best deals in the UK! 


What is stamp duty, and why do you pay it?

Anyone purchasing a home or piece of land that costs more than a particular amount must pay stamp duty, a one-time fee. The type and cost of the property determine the tax rate you will have to pay (i.e., residential or commercial).

Why is there a stamp duty on house purchases in the UK?

Stamp duty is levied on house purchases for the betterment of the country, including paying for public schools, hospitals, defense, and more.

Is it possible to avoid stamp duty?

Yes, stamp duty has several exemptions, including for first-time buyers.


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