STAMP DUTY: SURCHARGE STING

Anyone who owns one property and buys another can avoid the extra stamp duty surcharge if they are changing their main residence. This “replacement main residence” rule means that if you are selling your main home and then purchasing another main residence you will pay the standard rates of stamp duty. This includes buyto-let landlords, who can own hundreds of properties but pay no extra tax on a purchase as long as they are replacing a main residence. In general, you have to live in a property for it to be counted as your main residence.

Home owners who have not sold their main residence at the time of buying their new property will have to pay the higher rate of stamp duty, but can claim it back if they sell their main home within three years. People who live in accommodation provided by their employers, such as vicars, can replace a property they don’t actually live in, until November 2018, provided they have lived there in the past.

The additional rates mean that those buying a holiday home pay 3pc stamp duty on the first £125,000 of the value of the home, 5pc tax on the next £125,000, 8pc on the next £675,000, 13pc on the next £575,000 and 15pc on any amount above £1.5m.