While the UK’s Stamp Duty Land Tax (SDLT) surcharge on additional properties increased to 5% in late 2024, the 3% surcharge still applies to a large number of property transactions completed before that date. Many buyers who paid the extra tax on second homes, buy-to-let properties or temporary main residences may now be eligible for a refund—but are unaware of it.
In this article, we’ll explain why the 3% SDLT surcharge refund claim remains highly relevant in 2025 and beyond, who qualifies, and how you can ensure you don’t miss out.
What Was the 3% SDLT Surcharge?
Introduced in April 2016, the 3% SDLT surcharge was designed to deter property investors and second-home buyers from outbidding first-time buyers and owner-occupiers. It applied to most purchases of additional residential properties, such as buy-to-let homes, holiday lets, or bridging residences, before selling a previous main home.
This surcharge was added on top of the normal SDLT rates and applied across England and Northern Ireland. For example, a £400,000 buy-to-let purchase attracted an extra £12,000 in SDLT due to the 3% surcharge.
Although the rate increased to 5% in October 2024, any purchases completed prior to that date are still governed by the 3% rate. This makes understanding refund eligibility under the old rules crucial for buyers who completed transactions in earlier years.
Why You Might Still Be Eligible for a Refund
A common situation involves purchasing a new main residence before selling the old one. In such cases, the transaction is treated as an “additional property,” triggering the surcharge. However, if the buyer sells their former main residence within a specific timeframe, they may be eligible for a refund.
Here’s an example:
- You bought a new house on 1 March 2023 and paid the 3% surcharge.
- You sold your previous home on 15 July 2023.
- Provided you apply within the correct timeframe, you can make a 3% SDLT surcharge refund claim for the amount you overpaid.
Important Deadlines
To claim your refund, you must apply within 12 months of the sale of your previous main residence, or within 12 months of the filing date of the original SDLT return—whichever is later.
This means many buyers in 2023 and even early 2024 are still within their window to claim. Missing this deadline, however, usually means forfeiting the refund altogether, so timing is critical.
How to Apply
You can apply directly via HMRC’s online portal or by completing a paper SDLT refund form. You’ll need the following details:
- SDLT transaction reference number (from your solicitor or conveyancer)
- Addresses and dates of sale/purchase for both properties
- Your contact and banking details
- Proof of sale, such as a completion statement or title deed
While it’s possible to submit the form yourself, many people choose to engage tax professionals to ensure everything is correct—especially if large sums are involved.
What If the Refund Is Denied?
In some cases, HMRC may reject a claim due to incorrect information or missed deadlines. However, you have the right to appeal, and with proper documentation—such as proof of sale and explanations for any delays—you may be successful on review.
It’s always advisable to seek legal or tax advice if your situation is complex or if your original claim was refused.
