The surcharge – an additional three percentage points on each of the existing rates – is part of a clutch of measures aimed at supporting low-cost home ownership for first-time buyers. The surcharge will apply to most purchases of additional residential properties in England, Wales and Northern Ireland (equivalent measures will apply to land and buildings transaction tax in Scotland) where, at the end of the day of the transaction, the purchaser owns two or more residential properties and one of those properties has not replaced his or her previous main residence. Where the surcharge applies and the previous main residence is sold within 36 months, the surcharge can be reclaimed, provided that the property purchased will become the purchaser’s main residence. Controversially, the Government has rejected requests for business exemptions. The surcharge will apply to the first purchase of a residential property by a company subject to existing rules for mixed-use transactions and purchases of six or more dwellings in one transaction.
Read our detailed note on the surcharge here.