Changes to SDLT1 form: non-resident surcharge

On 6 January, the UK government published the Stamp Duty Land Tax (Administration) (Amendment) Regulations 2021.

The legislation updates form SDLT1 to allow for the introduction of a 2% non-resident stamp duty land tax (SDLT) surcharge that will apply to purchases of residential property by non-UK residents.

The changes come into force from 1 April 2021.

The regulations include new questions on the SDLT return in connection with the introduction of the SDLT surcharge on non-UK residents purchasing residential property in England and Northern Ireland.

The regulations also provide for the removal of question 64 (agent’s DX number and exchange).

Buyers are now asked whether they are non-resident or a UK-resident close company controlled by non-residents, and if they are claiming Crown Employment Relief.

HM Revenue and Customs (HMRC) say that where the effective date of the transaction is before 1 April 2021, the buyer can use either the new form or the current version, provided the form is delivered before 1 May 2021.

Our view

We look forward to seeing full HMRC guidance on how conveyancers should understand and approach the new questions, including the ‘close company’ and Crown Employment Relief references.

We hope to see practical guidance from HMRC on how practitioners should deal with the specific new residence test that needs to be considered in determining whether the surcharge applies.

We responded to HMRC’s consultation on the updated form in November.

What this means for solicitors

The introduction of the non-UK resident surcharge and these related changes to the SDLT return mean that, for the first time from 1 April 2021, solicitors and others in the home-buying process will have to consider the concept of residence.

Solicitors will need to obtain more information when filling out an SDLT return form.

Next steps


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