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SDLT: non-resident surcharge

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HMRC has set out (via the ATT) details of the new SDLT surcharge for non-residents purchasing residential property in England and Northern Ireland. From 1 April 2021:

  • a non-UK resident buying residential property in England or Northern Ireland will have to pay the new rates of SDLT;
  • the new rates will be 2% higher than those which apply to UK residents; but
  • the new rates will not apply for those who buy non-residential property (eg offices and shops).

Buyers will need to apply the SDLT residence tests to determine if they are a non-UK resident. Individual buyers may be able to claim a tax refund if, after the purchase, they are present in the UK for at least 183 days in the two-year period beginning a year before the purchase and ending a year after the purchase. Also, if they are a crown employee and/or their spouse or civil partner is one, they will be able to claim an up-front relief from the tax charge. Corporate buyers will be non-UK resident if they are not UK resident for corporation tax purposes at the date of buying the residential property. However, special rules will apply for UK resident companies which are under the direct or indirect control of non-UK resident persons.

According to HMRC, information about the new rates will be published alongside existing guidance material ‘soon’.

Issue: 1519
Categories: News