Holiday Let Stamp Duty UK — Current Rates, 5% Surcharge and Worked Examples

Last updated: July 2026

Stamp duty on a holiday let in England is higher than on a standard residential purchase. The 5% additional dwelling surcharge — raised from 3% in October 2024 — adds a significant upfront cost to every holiday let purchase above £40,000.

This page is written for buyers considering a holiday let purchase, landlords converting a second property to short-term letting, and anyone who has encountered an outdated 3% figure and needs confirmation of the current rate.

The SDLT question matters most before completion, not after. The rate table, worked examples, and income recovery context below give you the figures needed to model the full upfront cost accurately.

Multiple Dwellings Relief was abolished in June 2024. The 36-month refund rule still applies in specific circumstances. Both are explained in full below.

Holiday let stamp duty starts at 5% of the full purchase price — a 5% surcharge on top of standard residential SDLT rates, raised from 3% in October 2024. On a £250,000 purchase where you already own property, the SDLT bill is £15,000. Multiple Dwellings Relief was abolished in June 2024 and is no longer available. Full rate table, worked examples and income recovery context below.

What this page covers

  1. The 5% additional dwelling surcharge — and why most guides show the wrong rate
  2. Current SDLT rates for holiday lets in England — the complete rate table
  3. What you will actually pay — worked examples at three purchase prices
  4. When the surcharge applies — and three circumstances where it does not
  5. The 36-month refund rule — how to reclaim the surcharge if your circumstances change
  6. Buying through a limited company — the 17% flat rate explained
  7. How long it typically takes to recover the SDLT through short-term letting income
  8. Questions holiday let buyers ask about stamp duty
Free income estimate — see your net return before you commit See what your holiday let could earn — before you pay the stamp duty The estimate shows net monthly income for your postcode including quieter months — the figure that tells you whether the stamp duty is worth paying. Takes 2 minutes, no obligation.
5% additional dwelling surcharge — raised from 3% in October 2024
£125k nil-rate band — reverted from £250k in April 2025
14 days to pay SDLT after completion — via your solicitor
June 2024 Multiple Dwellings Relief abolished — no longer available

The 5% surcharge — and why most guides still show the wrong rate

Do I pay stamp duty on a holiday let?

Yes. A holiday let is treated as an additional residential property for SDLT purposes, so it attracts the 5% additional dwelling surcharge on top of standard rates — even if you plan to run it as a commercial business. The surcharge applies to every purchase above £40,000 where you already own another residential property. Source basis: HMRC SDLT guidance, effective from 31 October 2024.

The additional dwelling surcharge was introduced in April 2016 at 3% and remained unchanged for over eight years.

In the Autumn Budget 2024, the UK government increased it to 5%, effective from 31 October 2024.

Most guides, blog posts, and calculator pages published before November 2024 still reference the old 3% figure. Several holiday letting company pages have not been updated. The correct rate for any holiday let purchase completing on or after 31 October 2024 is 5% — not 3%.

A second change took effect on 1 April 2025: the nil-rate band for standard SDLT reverted from £250,000 back to £125,000. This was a temporary measure that expired. For any holiday let purchase completing on or after 1 April 2025, both changes apply simultaneously.

Key timeline

Before 31 October 2024: 3% surcharge, nil-rate band at £250,000. From 31 October 2024: 5% surcharge. From 1 April 2025: 5% surcharge AND nil-rate band reverted to £125,000. The worked examples below reflect the current position — both changes applied.

Holiday let SDLT in England — the complete rate table from April 2025

How much stamp duty do I pay on a holiday let?

On a £250,000 holiday let: £15,000. On a £350,000 purchase: £25,000. On a £500,000 purchase: £40,000. The rates are: 5% on the first £125,000; 7% on £125,001–£250,000; 10% on £250,001–£925,000; 15% on £925,001–£1,500,000; 17% above £1,500,000. These apply from 1 April 2025. Source basis: HMRC SDLT additional dwelling rates, July 2026.

SDLT is a banded tax, meaning you pay each rate only on the portion of the price that falls within that band — not on the entire purchase price.

For holiday lets and other additional dwellings, the 5% surcharge is added to every band from the first pound to the total purchase price.

Purchase price band Standard purchase Holiday let (additional dwelling)
Up to £125,000 0% 5%
£125,001 to £250,000 2% 7%
£250,001 to £925,000 5% 10%
£925,001 to £1,500,000 10% 15%
Over £1,500,000 12% 17%

England and Northern Ireland only. Rates from 1 April 2025, additional dwelling surcharge from 31 October 2024. Scotland charges LBTT (8% ADS). Wales charges LTT (5% surcharge). Always confirm with your solicitor before exchange.

What you will actually pay — worked examples at three purchase prices

The banded calculation is straightforward once you apply it. Each band below is calculated on the slice of the purchase price that falls within it, not the whole price.

£250,000 holiday let purchase
£0–£125k at 5% £6,250
£125k–£250k at 7% £8,750
Total SDLT £15,000

Effective rate: 6.0%

£350,000 holiday let purchase
£0–£125k at 5% £6,250
£125k–£250k at 7% £8,750
£250k–£350k at 10% £10,000
Total SDLT £25,000

Effective rate: 7.1%

£500,000 holiday let purchase
£0–£125k at 5% £6,250
£125k–£250k at 7% £8,750
£250k–£500k at 10% £25,000
Total SDLT £40,000

Effective rate: 8.0%

What changed in April 2025

Between September 2022 and 31 March 2025, the nil-rate band was temporarily £250,000, which reduced SDLT bills significantly. From 1 April 2025 the nil-rate band reverted to £125,000. Purchases completing from 1 April 2025 are calculated on the bands above. Source basis: HMRC SDLT threshold changes, April 2025.

When the 5% surcharge applies — and three circumstances where it does not

The surcharge applies when, at the end of the transaction day, you will own two or more residential properties and you are not replacing your main home.

It applies to the entire purchase price, including the portion that falls within the nil-rate band.

For couples and civil partners, the rules apply jointly: if either partner owns another residential property, the surcharge applies to the whole purchase — even if only one of you is on the title.

Three cases where the surcharge may not apply

First: the property is priced below £40,000 — the surcharge has a minimum threshold. Second: the property is not legally classed as residential — some holiday park structures and caravans on licence agreements may fall outside residential SDLT rules (confirm with your solicitor). Third: the property is being purchased as a replacement main home and your previous main home is sold on or before the completion date — the surcharge does not apply in this scenario.

SDLT COST COMPARISON — ENGLAND Standard purchase vs holiday let — what each buyer pays Standard purchase Holiday let (5% surcharge) £250k £2,500 £15,000 £350k £7,500 £25,000 £500k £15,000 £40,000 £750k £27,500 £65,000 THE SURCHARGE IMPACT The 5% surcharge adds £12,500–£37,500 to the SDLT bill at the four price points above Source: HMRC SDLT rates, April 2025 onwards. England and Northern Ireland only. Illustrative — confirm with your solicitor.

The 36-month refund rule — how to reclaim the surcharge if your circumstances change

Can I claim back stamp duty on a holiday let?

You can reclaim the 5% surcharge if you sell your previous main home within 36 months of buying the holiday let. The claim must be submitted to HMRC within 12 months of selling the old property. The refund is typically processed within 15–20 working days. No other straightforward exemption from the surcharge exists for holiday let purchases. Source basis: HMRC SDLT higher rates guidance, July 2026.

The refund rule applies in one specific scenario: you purchase a holiday let while still owning your main home, pay the 5% surcharge because you own two properties, and then sell your main home within 36 months of the holiday let purchase.

When you sell the main home, you can apply to HMRC for a refund of the 5% surcharge on the holiday let purchase.

The claim window is 12 months from the sale of the old main home, or 12 months from the SDLT filing date for the holiday let purchase, whichever is later.

Your solicitor will handle the refund claim in the same way they handled the original SDLT return. HMRC typically processes valid refund claims within 15–20 working days.

Inherited property

An inherited property counts as a residential property for surcharge purposes if you own a 50% or greater share and the inheritance occurred within the 36 months preceding the holiday let purchase. A share of 50% or less is disregarded. If you are unsure whether an inherited property triggers the surcharge, confirm with your solicitor before exchange.

Buying a holiday let through a limited company — the 17% flat rate on purchases over £500,000

A limited company purchasing a residential property for more than £500,000 pays a flat 17% SDLT rate on the entire purchase price — not the banded rates.

On a £500,000 company purchase: 17% × £500,000 = £85,000 in SDLT. Compared to £40,000 for an individual additional dwelling purchase at the same price. The company route costs more in SDLT at this price point.

For purchases below £500,000, a company pays the additional dwelling banded rates (5%, 7%, 10%) rather than the flat 17% rate. The individual and company calculations produce identical SDLT at sub-£500,000 prices.

Whether to purchase in personal name or through a limited company is a wider tax question — it involves income tax treatment of rents, corporation tax, mortgage interest relief, and capital gains tax on sale. The SDLT comparison above covers just one variable. Source basis: HMRC SDLT company purchase guidance, as of July 2026.

Tax note

SDLT is one of several variables in the personal vs company ownership decision. The full picture — including the post-April 2025 abolition of the Furnished Holiday Lettings tax regime — requires a qualified accountant to assess for your specific situation. Never make a structural decision on SDLT alone.

How long it typically takes to recover the SDLT through short-term letting income

The stamp duty bill is a real upfront cost. The question that matters more for most buyers is how quickly the property generates enough income to cover it.

At Stayful's managed portfolio average of £2,527 net per month across 70+ properties, a £15,000 SDLT bill is recovered within approximately 6 months of the property going live. A £25,000 bill within approximately 10 months. A £40,000 bill within approximately 16 months. Source basis: Stayful managed portfolio, July 2026.

These figures represent the point at which cumulative net STL income equals the SDLT cost. They use the portfolio average, not a best-case figure. Individual results vary by location, property type and occupancy.

6–16
months

Typical SDLT recovery period for holiday let purchases between £250,000 and £500,000, based on Stayful's managed portfolio average of £2,527 net per month. Source basis: 70+ properties across England, July 2026. Results vary by location, property type and occupancy. Conservative estimate — not a guarantee.

For buyers purchasing specifically for short-term letting, the income recovery period is the more useful metric than the SDLT figure in isolation.

A £40,000 SDLT bill on a £500,000 property earning £2,500 per month net is recovered in approximately 16 months — well within the first two years of ownership.

The income estimate below shows what your specific property and postcode could realistically earn — including quieter months, not just the peak figure. That is the figure to use when calculating your own recovery period.

Properties that would be difficult to short-let — remote rural locations, very seasonal markets, or properties with structural occupancy limitations — may have significantly longer recovery periods. The income estimate identifies this before purchase, not after.

Questions holiday let buyers ask about stamp duty

Yes. For SDLT purposes, a holiday let is treated identically to a second home or buy-to-let property. HMRC classifies it as an additional residential property, which triggers the 5% surcharge above standard rates. There is no special category or exemption for properties genuinely operated as holiday lets — the intention to use it commercially does not change the SDLT classification.
Multiple Dwellings Relief (MDR) was abolished on 1 June 2024. For any transaction completing on or after that date, MDR cannot be claimed. Before abolition, MDR allowed buyers purchasing multiple dwellings in a single transaction to average the SDLT across all properties, which reduced the effective rate significantly. The relief was frequently used for portfolio acquisitions. It is no longer available. Some guides published before June 2024 still reference it as an option — this is now incorrect.
SDLT must be paid within 14 days of the completion date. Your solicitor handles this as part of the conveyancing process — they calculate the amount, collect it from you, and file the return with HMRC. Late filing incurs automatic penalties. Note: many older guides and some solicitor websites still reference 30 days, which was the deadline before March 2019. The current deadline is 14 days and has been since then.
Yes. Married couples and civil partners who live together are treated as a single unit for SDLT purposes. If you own another residential property, the surcharge applies to the whole purchase regardless of whether your partner is a first-time buyer or has never owned property. This rule applies even if your partner is the sole purchaser named on the transaction.
Scotland charges Land and Buildings Transaction Tax (LBTT) instead of SDLT, with an 8% Additional Dwelling Supplement (ADS) for additional properties — the steepest second-home surcharge in the UK. Wales charges Land Transaction Tax (LTT) with a 5% higher-rate surcharge. Stayful operates across England only — this page covers SDLT in England. For Scottish or Welsh holiday let purchases, confirm rates with your solicitor as they differ materially from the figures shown here.
No. SDLT is a capital acquisition cost, not a revenue expense. It cannot be deducted from rental income for income tax purposes. It can, however, be added to the base cost of the property for capital gains tax purposes — which reduces your CGT liability when you eventually sell. The distinction matters: SDLT does not reduce your annual income tax bill, but it does reduce the capital gain on which CGT is charged at exit. Confirm the CGT treatment with your accountant.
The additional dwelling surcharge applies to additional residential properties priced above £40,000. Properties below £40,000 are exempt from the surcharge. Properties between £40,000 and £125,000 attract the 5% surcharge (which is the only applicable rate in that band — standard SDLT is 0%). There is no SDLT threshold at £125,000 for additional dwelling purchases — the 5% surcharge applies from £40,001.
The Furnished Holiday Lettings (FHL) tax regime was abolished on 6 April 2025. Holiday let income is now treated as standard UK property income for income tax. The main changes: mortgage interest relief is now capped at 20% (the same as buy-to-let); capital allowances on furniture and fixtures are no longer available on new purchases; Business Asset Disposal Relief on sale was removed; and holiday let income no longer qualifies as relevant earnings for pension contributions. SDLT itself is unaffected by the FHL abolition. For the income tax picture, see the furnished holiday let allowable expenses guide.

Company

Stayful

Coverage

England

See what your holiday let could earn — before you commit to the purchase

The income estimate shows net monthly figures for your postcode — including quieter months, not just the peak. The figure that tells you whether the stamp duty bill is worth paying in your specific location.