Yes — foreign buyers pay stamp duty when purchasing residential property in England and Northern Ireland. In fact, non-UK residents are subject to an additional 2% surcharge on top of the standard SDLT rates that apply to all residential buyers. This non-resident surcharge sits on top of standard stamp duty rates and, where applicable, on top of the additional dwelling surcharge for buyers who already own property elsewhere.
The question that matters practically is not whether you pay stamp duty — you do — but how much the total bill comes to when all applicable surcharges are stacked, and how residency is determined for this specific purpose.
What Stamp Duty Land Tax Is
Stamp Duty Land Tax (SDLT) is the tax paid by the buyer on the purchase of residential or commercial property in England and Northern Ireland. It is a progressive tax applied in bands — each rate applies only to the portion of the purchase price that falls within that band, not to the full price.
Scotland has its own equivalent — Land and Buildings Transaction Tax (LBTT) — and Wales uses Land Transaction Tax (LTT). The non-resident surcharge described in this guide applies specifically to England and Northern Ireland SDLT. Scotland uses LBTT with 8% Additional Dwelling Supplement and no non-resident surcharge. Wales uses LTT with a 5% surcharge and no non-resident surcharge.
SDLT must be filed and paid to HMRC within 14 days of completion. Your solicitor handles the filing and payment on your behalf as part of the conveyancing process.
Current SDLT Rates in 2026
Two rounds of stamp duty changes reshaped the SDLT landscape in England and Northern Ireland. On 31 October 2024, the Autumn Budget increased the additional dwelling surcharge from 3% to 5%. On 1 April 2025, the temporary nil-rate thresholds expired: the standard band reverted from £250,000 to £125,000. No further changes have been announced for 2026, so these rates remain in force.
Standard residential SDLT rates (England, from 1 April 2025):
- 0% on the first £125,000
- 2% on £125,001 to £250,000
- 5% on £250,001 to £925,000
- 10% on £925,001 to £1,500,000
- 12% above £1,500,000
These are the rates for a standard residential purchase by a UK resident buying their only or primary residence.
The Non-Resident Surcharge
In April 2021, a 2% stamp duty surcharge for overseas buyers purchasing residential property in England and Northern Ireland was introduced. The surcharge applies to any type of non-resident buyer (company or individual).
Non-UK residents purchasing residential property in England or Northern Ireland must pay an additional 2% SDLT surcharge on top of standard rates. This applies regardless of whether you’re a first-time buyer or purchasing an additional property.
The 2% surcharge applies to every band — it is not just applied to the amount above a threshold. It stacks on top of the standard rates as a flat additional percentage across the full purchase price.
The Additional Dwelling Surcharge
The additional dwelling surcharge applies when a buyer already owns another residential property anywhere in the world and is not replacing their main residence. Additional property / second home purchases in England attract a +5% surcharge on every band, applying from £40,000.
For a foreign buyer who already owns a property in their home country — which covers most international buyers — the additional dwelling surcharge applies alongside the non-resident surcharge.
How the Surcharges Stack
The non-resident surcharge is levied in addition to the 5% buy-to-let and second homes charge and the existing stamp duty rates for home buyers.
For a foreign buyer who already owns property elsewhere:
Total SDLT = Standard rates + 5% (additional dwelling) + 2% (non-resident)
At the top band (above £1.5m), this produces an effective top rate of 19%: 12% (standard) + 5% (additional dwelling) + 2% (non-resident) = 19%.
Overseas buyers who already own a home will pay the new 2% surcharge in addition to the existing 5% charge levied on additional property purchases. This means for additional property transactions the top rate of stamp duty is now 19%.
A Worked Example: Foreign Buyer Purchasing a £1,000,000 London Flat
Standard SDLT on £1,000,000 (banded calculation):
- 0% on first £125,000 = £0
- 2% on £125,001 to £250,000 = £2,500
- 5% on £250,001 to £925,000 = £33,750
- 10% on £925,001 to £1,000,000 = £7,500
- Standard SDLT subtotal = £43,750
Additional dwelling surcharge (5% across full price):
- 5% × £1,000,000 = £50,000
Non-resident surcharge (2% across full price):
- 2% × £1,000,000 = £20,000
Total SDLT = £43,750 + £50,000 + £20,000 = £113,750
This represents 11.375% of the purchase price — more than double the standard SDLT that a UK resident buying their only property would pay (£43,750, or 4.375% of the price).
How Residency Is Determined for SDLT Purposes
The SDLT residency test is specific to stamp duty — it is not the same as income tax residency, visa status, or domicile. For SDLT purposes, non-UK resident status is generally determined by whether you have spent fewer than 183 days in the UK during the 12-month period leading up to the purchase.
For SDLT purposes, you are UK resident if you were present in the UK for at least 183 days in the 12-month period ending on the effective date of the transaction (usually completion day). The SDLT residence test is purely based on physical presence (183 days).
This has several practical implications:
Nationality is irrelevant. A non-UK citizen who has lived and worked in the UK for three years and has been in the UK for over 183 days in the 12 months before completion pays standard SDLT rates — no non-resident surcharge.
UK passport holders living abroad pay the surcharge. A British citizen who has been living in Dubai and has spent fewer than 183 days in the UK in the past year is classified as non-resident for SDLT purposes and pays the 2% surcharge.
The test is at completion, not exchange. Residency is assessed at the effective date of the transaction — typically completion day. Residency is tested at completion. An exchange-and-then-move-back-to-UK strategy can avoid the 2% surcharge if 183 days are spent in the UK before completion.
Joint purchases where one buyer is non-resident. If any one purchaser is non-UK resident, the surcharge applies to the whole transaction. A UK-resident buyer purchasing jointly with a non-UK-resident buyer will pay the surcharge on the entire purchase price. This is a significant point for mixed-residency couples.
The Refund Route
A refund is available if you become UK resident within 12 months of the purchase. If you complete a purchase as a non-resident but then spend at least 183 days in the UK in the 12-month period following completion — establishing UK residency for SDLT purposes — you can apply to HMRC for a refund of the 2% non-resident surcharge.
This is a legitimate and relatively straightforward refund mechanism. The refund application must be made within two years of the purchase date. If you are planning to move to the UK and intend to use the purchased property as your main residence, the refund route is worth understanding before completion.
Read also- what’s the difference between leasehold and freehold
First-Time Buyer Relief for Foreign Buyers
The 2% non-resident surcharge applies regardless of whether you’re a first-time buyer.
First-time buyer relief — which provides 0% SDLT on the first £300,000 and standard rates above for purchases up to £500,000 — is a UK-based relief. The non-resident surcharge stacks on top of it. A foreign buyer purchasing their first residential property in the UK still pays the 2% non-resident surcharge on the full purchase price, even if they qualify for first-time buyer relief on the standard bands.
For a foreign first-time buyer purchasing at £350,000:
- First-time buyer relief applies: 0% on first £300,000 = £0; 5% on £50,000 = £2,500
- Non-resident surcharge: 2% × £350,000 = £7,000
- Total SDLT = £9,500
Compared to a UK resident first-time buyer purchasing at £350,000:
- First-time buyer relief: £2,500 only
- No non-resident surcharge
The surcharge adds £7,000 even at this modest price level.
For official HMRC guidance on the non-resident SDLT surcharge, check: GOV.UK — SDLT non-resident surcharge
Practical Planning Points
Calculate the full SDLT cost before making an offer. Many foreign buyers calculate standard SDLT from online calculators without accounting for the non-resident surcharge. The actual bill can be 40 to 100% higher than the standard calculation depending on the circumstances. Your solicitor should provide a precise SDLT calculation as part of the pre-offer advice.
SDLT is paid at completion, filed within 14 days. Sterling funds must be available at completion. For buyers holding funds in foreign currencies, exchange rate planning should account for the full SDLT liability in sterling.
Company structures and SDLT. Purchasing through a company has specific SDLT implications. The surcharge applies to any type of non-resident buyer (company or individual). Additionally, properties over £500,000 purchased by companies as envelopes are subject to a flat 17% SDLT rate — making company purchase structures significantly more expensive at this price point.
For an SDLT calculation specific to your circumstances, check: GOV.UK — Stamp Duty Land Tax calculator
Conclusion
Foreign buyers do pay stamp duty in the UK — and pay more than UK residents due to the 2% non-resident surcharge. For most foreign buyers who also own property elsewhere, the additional dwelling surcharge of 5% also applies, producing total SDLT rates of up to 19% at the top band. Residency for SDLT purposes is determined by physical presence — 183 days in the UK in the 12 months before completion — not by nationality or visa status. A refund of the 2% surcharge is available if the buyer establishes UK residency within 12 months of purchase. Calculate the full SDLT position before making any offer.
Frequently Asked Questions
What is the total stamp duty for a non-resident buying a £500,000 property?
A non-resident buyer who already owns another property pays: standard SDLT of approximately £17,500, plus additional dwelling surcharge of £25,000 (5% of £500,000), plus non-resident surcharge of £10,000 (2% of £500,000) — a total of approximately £52,500, representing 10.5% of the purchase price.
Can I get a refund of the non-resident stamp duty surcharge?
Yes — if you become UK resident within 12 months of completing the purchase (by spending at least 183 days in the UK in the 12-month period following completion), you can apply to HMRC for a refund of the 2% non-resident surcharge. The application must be made within two years of the purchase date.
How is non-resident status determined for stamp duty?
For SDLT purposes, non-resident status is determined by physical presence alone — whether you have spent fewer than 183 days in the UK in the 12-month period ending on the completion date. Nationality and visa status are irrelevant. A UK citizen living abroad for over 6 months in the year before purchase pays the surcharge; a foreign national who has lived in the UK for a year and spent over 183 days here does not.
