Can I Claim Back Stamp Duty On Buy-To-Let?

Nikka Sulton

Can I Claim Back Stamp Duty On Buy-To-Let?

Navigating the intricacies of stamp duty for buy-to-let properties can be a complex endeavor. The amount you pay is contingent on factors such as your buyer status, geographical location within the UK, and the property’s value. Despite the potential stress associated with stamp duty, buy-to-let properties continue to be a preferred investment avenue for individuals and companies in the UK.

For those who have recently sold a buy-to-let property, Stamp Duty Rebate offers a solution. Our platform is dedicated to helping property buyers and investors understand stamp duty and facilitate the process of claiming back eligible amounts. Whether you’re a seasoned investor or a first-time buyer, Stamp Duty Rebate strives to simplify the complexities surrounding stamp duty, ensuring a straightforward and accessible experience for all.

What Is a Buy-to-Let?

A buy-to-let property is specifically purchased for rental purposes, incurring higher stamp duty rates for buyers. The elevated rates stem from the potential income generated through future rent. Although first-time buyers are exempt from increased stamp duty for buy-to-let properties, their chances of acquiring such properties are typically low. Consequently, buyers of buy-to-let properties often fall into the category of second-time buyers, facing the higher stamp duty rates. Despite being an appealing entry point into property ownership, the associated stamp duty for buy-to-let properties can be a costly consideration.

Is Stamp Duty Payable on a Buy-to-Let?

Certainly. Stamp duty is indeed applicable to buy-to-let properties in the UK, and the rates vary between Scotland and Wales compared to Northern Ireland and England. In the latter two, buyers of buy-to-let properties face higher stamp duty rates. This increase stems from the implementation of a new stamp duty rate for second-home buyers by HMRC in 2015. The intention behind this move was to regulate property ownership and potentially enhance accessibility to the property ladder in the UK.

However, while this measure aimed at promoting fairness in property ownership, it has introduced an additional financial consideration for those seeking to invest in buy-to-let properties. The higher stamp duty rates on these properties contribute to the overall cost, potentially impacting the financial calculations and decisions of individuals and companies involved in the buy-to-let market.

How Much Is Stamp Duty on a Buy-to-Let?

Buy-to-let property buyers typically own a primary residence, subjecting them to additional stamp duty rates. As of 2023, the stamp duty rates for buy-to-let properties in England and Northern Ireland are as follows:

Property Price	Normal Stamp Duty Rates	Buy-to-Let Stamp Duty Rates
£0 – £250,000	0%	3%
£250,001 – £925,000	5%	8%
£925,001 – £1.5 million	10%	13%
£1.5 million +	12%	15%

Properties valued at £40,000 or less are exempt from regular and additional stamp duty rates. First-time buyers acquiring buy-to-let properties will incur standard stamp duty rates, but they won’t qualify for first-time buyer discounts as they won’t reside in the property. Overseas buyers face an extra 5% surcharge since April 2021. Utilizing an online stamp duty buy-to-let calculator can help estimate the amount owed when acquiring a buy-to-let property.

Are There Any Exemptions for Buy-to-Let Stamp Duty?

Stamp duty rates for buy-to-let properties generally don’t come with exemptions unless you’re a first-time buyer or acquiring the property solely for investment without residing in it. First-time buyers, while spared the surcharge, will be subject to standard stamp duty rates.

For couples in civil partnerships or marriages, the additional stamp duty rates apply, irrespective of the number of properties either partner owns. Transferring ownership to a spouse won’t exempt you from the additional stamp duty, as legally united couples are considered a singular entity.

Even companies investing in buy-to-let properties are liable for additional stamp duty rates. However, if you’re making a bulk purchase of several properties in a single transaction, there’s potential for a discount through Multiple Dwellings Relief (MDR).

Can I Claim Back Stamp Duty on a Buy-to-Let?

Certainly, you could qualify for a stamp duty refund in specific situations. For instance, if you’ve sold your primary residence or second home and have relocated to the initial buy-to-let property, you might be eligible for a refund on the initial surcharge paid. This relocation, however, needs to happen within three years of selling your primary residence.

Similarly, if you’ve separated from your partner and divested your share in the buy-to-let property within 36 months, you could be eligible for a stamp duty rebate.

How Can I Get a Stamp Duty Refund for a Buy-to-Let Property?

If you think you’ve paid too much stamp duty on a buy-to-let property, or if you’ve sold or are planning to sell one, reach out to us at Stamp Duty Rebate. While you can reclaim stamp duty through HMRC, seeking assistance from experts might be the optimal approach.