Buying a second property can be a good investment, but it also comes with extra costs you need to consider. One of the largest is stamp duty. If you already own a home, you’ll usually pay a higher rate on your new purchase. This extra charge is called the stamp duty surcharge, set at 3% above the standard rates in England and Northern Ireland. It applies every time you buy an additional property, unless you are replacing your main residence.
The exact amount depends on the property’s price, its location, and the type of property being bought. In 2025, updated rules and rates apply, so it’s important to check the latest thresholds. This section explains those changes and shows how to calculate what you’ll need to pay.
What is stamp duty?
Stamp duty is a tax you pay when buying property. In England and Northern Ireland, it is called Stamp Duty Land Tax (SDLT). In Scotland, it is the Land and Buildings Transaction Tax (LBTT), and in Wales, it is the Land Transaction Tax (LTT). Each system applies higher rates when you buy a second home or another property. Rules and thresholds for different regions are covered under the understanding of stamp duty.
Stamp duty changes in 2025
From 2025, the basic thresholds for stamp duty are changing. These updates are designed to make it easier for first time buyers to get on the property ladder.
However, the extra cost for anyone buying a second property remains in place. The 3% stamp duty surcharge is still added to the normal rates. So even if the main rates fall, buyers of additional homes will still pay more than those buying a first home.
Stamp duty rates for second homes in England and Northern Ireland (2025)
To see how much stamp duty is on a second home, let’s look at the 2025 rates.
| Property Price Band | Standard Rate | Rate with 3% Surcharge |
| Up to £250,000 | 0% | 3% |
| £250,001 – £925,000 | 5% | 8% |
| £925,001 – £1.5 million | 10% | 13% |
| Above £1.5 million | 12% | 15% |
Example: £300,000 second home
- Up to £250,000 at 3% → £250,000 × 3% = £7,500
- £250,001 – £300,000 at 8% → £50,000 × 8% = £4,000
Total SDLT = £11,500
When you need to calculate stamp duty for second home costs, it helps to split the price into bands, apply the right rates, and then add the surcharge.
The higher rates for second homes in Scotland and Wales
If you are buying a second property in Scotland or Wales, the rules are slightly different from those in England and Northern Ireland. Both countries apply their own property taxes, and these include higher rates for anyone purchasing an additional home.
Scotland – Land and Buildings Transaction Tax (LBTT):
In Scotland, stamp duty is replaced with LBTT. Buyers of second homes must also pay the Additional Dwelling Supplement (ADS), charged at 6% of the total purchase price.
Example: A flat costing £250,000 would attract normal LBTT plus £15,000 for the 6% ADS.
Wales – Land Transaction Tax (LTT):
In Wales, the tax is called LTT. For second homes and buy to let properties, an extra 4% is added to the normal LTT rates.
Example: On a house costing £200,000, the surcharge would add £8,000.
Stamp duty calculator
Working out stamp duty can be confusing, especially if the property price spans more than one band. Online tools make it easier to calculate stamp duty for second homes in just a few seconds. Always check the latest second home stamp duty rates before you buy.
If you’re planning to rent out the new property, learn about let to buy systems. This type of mortgage lets you rent out your current home while buying another, which can change how your taxes and borrowing are assessed.
What counts as a second home?
A second home is any property you purchase in addition to your main residence. It makes no difference whether the property is a holiday retreat, a buy to let investment, or even a house bought for family members. If you already own one property and then buy another, the higher rate of tax usually applies.
Funding a second home can be approached in different ways. Some buyers use savings, while others take out a new mortgage. Deciding whether you can remortgage to buy another property depends on your income, the value of your current home, and the type of mortgage you already have. For many, releasing equity from their main residence is one way to raise funds for the second purchase, but it’s not the right option for everyone.
When do you have to pay the second home surcharge?
The second home surcharge becomes due when a property purchase completes. In England and Northern Ireland, you must submit your Stamp Duty Land Tax (SDLT) return and pay the surcharge within 14 days of the completion date.
In Scotland, under the Land and Buildings Transaction Tax (LBTT), the equivalent Additional Dwelling Supplement (ADS) must be included in the LBTT return and paid within 30 days of the transaction’s effective date.
In Wales, a similar timeframe applies for Land Transaction Tax (LTT); returns and payments must also be made promptly after completion. Missing these deadlines can lead to penalties or interest, so it’s wise to prepare in advance. Many buyers ask their solicitor or conveyancer to handle the return and payment to make sure everything is submitted on time.
Can you reclaim the stamp duty surcharge?
Yes, in some cases. If you buy a second property but then sell your first home within three years, you can usually reclaim the extra tax you paid. The refund process is handled by HMRC. This is common when a sale and purchase do not happen at the same time.
Are there any exemptions to the second home stamp duty?
There are a few cases where the extra tax does not apply. For example:
There are limited cases where the extra tax does not apply. For example:
- If the property price is below the current stamp duty threshold
- If you are replacing your main home
- Some inherited properties may also fall outside the rules
Key points to remember
- Buying a second home means paying extra tax
- The 3% stamp duty surcharge applies in England and Northern Ireland; Scotland and Wales have their own higher rates
- Always check the current second home stamp duty rates before buying
- Use a calculator to know the full cost in advance
Final thoughts
Stamp duty rules can feel complex, but they are important to understand before buying another property. Knowing the extra costs helps you plan better and avoid surprises. By checking the latest second home stamp duty rates and using calculators to work out your bill, you can move forward with confidence.