Reminder: new SDLT rates for non-UK residents

From 1 April 2021, different rates of stamp duty land tax (SDLT) will apply to buyers of residential property in England and Northern Ireland who are not resident in the UK.

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The new rates being introduced will be 2% higher than rates that apply to purchases made by UK residents.

The rates will apply to the purchase of both freehold and leasehold properties.

The rates will also increase the amount of SDLT that will be payable on rents when a new lease is granted.

The rates will apply to all ‘non-resident transactions’, regardless of whether the buyer intends to live in the property and/or if the buyer already owns a residential property.

The non-UK resident test

The test to establish whether a buyer is non-UK resident in relation to a transaction depends on who the buyer is.

Nationality, citizenship or residence status under the UK statutory residence test are not relevant for this purpose.

Instead, there are specific new SDLT residence tests that will need to be applied depending on who the buyer is (for example, an individual, a joint buyer, a company, a partnership, a trust, and so on).

Further information

The updated GOV.UK guidance has more information on various aspects of the rules which will come into effect, including on:

  • applying the new SDLT residence tests
  • the type of records that HM Revenue and Customs (HMRC) may ask buyers to provide to prove presence in the UK

The SDLT1 form and guidance on completing the SDLT1 form are also changing, with added questions to implement the new rates for non-residents.

Read our response to HMRC’s consultation on the SDLT changes

Find out what’s changing on the SDLT1 form

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