Claim Back Stamp Duty on a Buy-to-Let: Learn How To Get Stamp Duty Refund
Understanding the stamp duty land tax (SDLT) rules for buy-to-let investments can seem like a maze. Your payable SDLT depends on your buyer status, UK or Northern Ireland location, and the property’s value. Still, despite an added layer of stamp duty stress, buy-to-lets are attracting an increasing number of UK individuals and corporations.
If you sold a buy-to-let property, you may claim a stamp duty refund with Expert Mortgage Brokers. We simplify the stamp duty rates, refund process, and how to claim back stamp duty for residential property buyers and investors.
Uncertain about the stamp duty surcharge for a second home or a main residence? Contact us today to see if you’re eligible for a buy-to-let SDLT refund.
What is buy-to-let?
Buy-to-let refers to properties purchased specifically to be rented out. However, acquiring such property types often means paying a higher stamp duty rate. These properties provide an avenue for future rental income.Â
First-time buyers may not face these inflated stamp duty rates when buying to let. However, their chances of affording such properties are slim. Buy-to-let buyers usually already have a main home, so they are considered second-home buyers according to HMRC stamp duty rules.
Buy-to-let properties offer a way to get into the property market, but the stamp duty land tax (SDLT) can be high. If you’ve sold or plan to sell your previous buy-to-let property, feel free to reach out to us. We are more than willing to assist in identifying if you may be able to make a claim and claim back your stamp duty.
Can I claim back stamp duty on a buy-to-let?
Absolutely! If you’ve sold your main residence or second home and now reside in the original buy-to-let property, you could be eligible for a stamp duty refund on the initial surcharge you paid. Claiming back stamp duty is straightforward—apply online or by post with essential property details and the SDLT transaction reference number.
Stamp duty, also known as Stamp Duty Land Tax (SDLT), is applied to buy-to-let properties throughout the UK, but the rates may differ. Specifically, the stamp duty rates for such properties are higher in England and Northern Ireland than in Wales and Scotland. In 2015, HMRC introduced a new stamp duty rate for buyers of second homes.
The stamp duty increase was meant to help first-time buyers but made it more expensive for people who want to invest in buy-to-let properties. In some cases, you can recover stamp duty or request a refund for it. If you paid a higher rate of stamp duty because you couldn’t sell your previous main residence before buying a new one, you can claim a refund for the stamp duty.
How much stamp duty on buy-to-let properties?
If you want to buy rental properties in 2024, you’ll need to pay Stamp Duty Land Tax (SDLT) based on the property’s price. The SDLT threshold differs for first-time buyers and existing buyers. For first-time buyers purchasing buy-to-let properties, a 5% stamp duty applies from £425,001 to £625,000. Properties costing £425,000 and under may be exempt from the SDLT. For existing buyers, the SDLT threshold is £0 if you’re buying an additional home and £250,000 if it’s your only property.
The stamp duty on a buy-to-let property can be higher if you already own a home. These higher stamp duty rates are 3% above the standard stamp duty rate. However, you could claim a refund of this additional stamp duty if you sell your original home within 3 years of buying the new property. To avoid overpaying, we advise using an online stamp duty calculator to determine the exact amount of stamp duty payable.
The most recent landlord stamp duty rates— which have been in place since September 23, 2022— are as follows:
| Property Purchase Price | Standard SDLT Rates | Higher SDLT Rates |
| Below £250,000 | 0% | 3% |
| The next £675,000 (From £250,001 to £925,000) | 5% | 8% |
| The next £575,000 (From £925,001 to £1.5 million) | 10% | 13% |
| The remaining amount (The portion above £1.5 million) | 12% | 15% |
In summary, buying property in the UK can be expensive, especially with the addition of stamp duty. It’s essential to remain informed about any changes in stamp duty rates, the ability to claim back stamp duty, and the potential for a stamp duty rebate. If you’re considering entering the UK property market, get in touch with a financial advisor to discuss your options.
Further information on SDLT can be found on the HMRC stamp duty website. Here, you can also find an online stamp duty calculator to compute your potential stamp duty. Please remember to pay stamp duty within 14 days of your property or land purchase to avoid any extra charges.
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Are there any exceptions to reclaiming stamp duty tax in the UK?
Yes, in some uncommon cases, one can reclaim Stamp Duty Tax. Some of these exceptions are:
Multiple dwellings relief (MDR)
When buying multiple homes at once, you might qualify for MDR, which offers a lower Stamp Duty Tax rate based on the total property value. Please note, MDR does not apply when purchasing a single buy-to-let property.
Purchase cancellation
There could be situations where a property deal falls apart, calling off the transaction. In such a case, if Stamp Duty Tax has been paid, one might be eligible for a refund. The specific circumstances of the cancellation determine the variation, so it is advisable to consult HM Revenue and Customs (HMRC).
Stamp duty tax overpayment
Overpayment of Stamp Duty Tax can happen due to calculation errors or miscalculations. If you believe you’ve overpaid the Stamp Duty Tax on your property purchase, it’s possible to apply for a refund for the surplus amount.
What’s the trick to lowering stamp duty tax on your buy-to-let property in the UK?
In the UK market, it doesn’t have to be difficult to find legal ways to reduce your Stamp Duty Tax on buy-to-let properties.
Opt for price negotiation
One simple way to cut down your Stamp Duty Tax is by pulling off a lower purchase price for the property. Sounds straightforward, right? A higher purchase price equals a higher tax. Thus, even a slight negotiation can make a significant difference.
Think transfer of equity
If you want to buy a property with a partner for renting, you might decide to give more ownership to the person with a lower income. This could reduce your overall Stamp Duty Tax.
Consider buying via a limited company
Some savvy landlords choose to acquire buy-to-let properties through a limited company rather than going solo. This choice can carry its own tax effects, but it could be your ticket to lower Stamp Duty rates on some properties.
Timing is crucial
Remember that timing matters. Government budgets can cause fluctuations in Stamp Duty rates and thresholds. Buying before or after anticipated changes might just swing your Stamp Duty Tax liability in your favour.
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Why select experts mortgage brokers?
If you’re considering a stamp duty rebate, Experts Mortgage Brokers is your best choice. We pride ourselves on our swift, secure, and efficient service, ensuring our clients’ satisfaction throughout the entire process.
Dealing with taxes and finances can often be tedious and stressful. Why not let us carry this burden for you? By entrusting us with this job, you save valuable time and enhance your chances of getting back the thousands of pounds you might be due.
Hassle-free process, outstanding results
Our application process is simple and accessible to all. Our dedicated team will complete everything on your behalf. With Experts Mortgage Brokers, you’re choosing more than just an easy path. You’re also opting for an experienced team that values your time and money.
Make your claim today!
Take the first step towards getting thousands of pounds back from HMRC. Reach out to us and find out if you’re entitled to a stamp duty rebate. With years of expertise in the field, you can trust you’re in safe hands with Experts Mortgage Brokers. It’s time to make a big move for yourself, and the entire UK is our market.
