A US home can trigger higher rates, a day count can trigger the non-resident surcharge, and the US treats SDLT as basis, not a deduction.
An American buying a home in England is usually paying Stamp Duty Land Tax in up to three layers: the standard residential bands, a further 5% if the purchase means owning more than one home anywhere in the world (a US house counts), and a 2% surcharge for buyers who are not UK resident under SDLT's own day-count test. Stacked together on a London price, the bill can be well over double the standard figure. On the US side, SDLT is not a deductible tax or a creditable one, but as a transfer tax it is generally added to your cost basis, which matters when you come to sell.
This article covers SDLT only. For the mortgage, currency and lending questions, see buying a UK home as a US citizen; for company ownership, see ATED and US owners.
SDLT is the property transaction tax for England and Northern Ireland. GOV.UK is explicit that a purchase in Scotland falls under Land and Buildings Transaction Tax, and a purchase in Wales under Land Transaction Tax. The non-resident surcharge does not apply to purchases in Scotland or Wales.
The return must be filed and the tax paid within 14 days of completion. Your conveyancer normally files and pays on completion, so the SDLT needs to be in sterling, in the UK, beforehand.
HMRC currently publishes the following residential rates for a buyer paying standard SDLT:
These are marginal rates: each applies only to the slice within its band. The two surcharges below are different, because they are added to every band, including the zero band.
This is the layer that catches most Americans. GOV.UK's guidance states that the higher rates apply where, at the end of the day of purchase, the new property will not be the only residential property worth £40,000 or more that you own (or part own) anywhere in the world. The purchase price must also be £40,000 or more.
The higher rates currently published are 5% on the first £125,000, 7% to £250,000, 10% to £925,000, 15% to £1.5 million and 17% above that: in other words, the standard bands plus 5 percentage points throughout.
"Anywhere in the world" is meant literally: a house in Connecticut, a Florida condo or a US rental in your own name can each count. Three points follow.
Replacing a main residence. The higher rates do not apply if you are buying a new main home and have already sold or given away the last main home you owned. If you buy the London home first and sell the US home later, you pay the higher rates on completion but can apply for a refund if you sell or give away your previous main home within 3 years of buying the new one. The refund claim must be made within 12 months of the later of the sale of the old home and the filing date of the SDLT return on the new one. A US home that was genuinely your main residence can qualify for this, so the timing of a US sale belongs in the plan.
Spouses. Married couples and civil partners are looked at together. GOV.UK states that if either spouse individually would have to pay the higher rates, the higher rates apply to the transaction as a whole, unless you are permanently separated. Putting the London purchase in the name of the spouse who owns nothing in the US does not get around this.
A pied-à-terre. If the US home remains your main residence and the London flat is a second home, there is no replacement and no refund route.
Since 1 April 2021 there has been a 2% surcharge on residential property in England and Northern Ireland bought by non-UK residents. It is charged on top of all other residential rates, including the higher rates for additional dwellings.
SDLT has its own test, and it is a simple day count. An individual is non-UK resident for this purpose if they are not present in the UK for at least 183 days during the 12 months before the purchase. You are counted as present on a day if you are in the UK at the end of that day.
HMRC is clear that nationality, citizenship or residence status under the UK Statutory Residence Test are not relevant. You can be UK resident for income tax under the Statutory Residence Test (which our residency guide explains) and still be non-resident for SDLT, because you arrived only a few months before completion. Equally, a British passport holder living in New York is non-resident for SDLT regardless of citizenship.
Joint purchases need care. If any one of several joint buyers is non-UK resident, all are treated as non-UK resident, with an exception for spouses and civil partners: if one of a married couple is UK resident in relation to the transaction, both are treated as UK resident.
For a family relocating to London, the surcharge is often temporary. An individual buyer can apply for a repayment if all purchasers are individuals and have spent 183 days in the UK in any continuous 365-day period that starts no more than 364 days before the effective date of the transaction and ends no more than 365 days after it. The application amends the original SDLT return and must be made within 2 years of the effective date, which is usually completion.
A buyer who completes shortly after arriving and then stays will usually be able to reclaim it. The claim rests on travel records showing where you were at the end of each day, so keep them from the day you land.
First-time buyer relief currently gives no SDLT up to £300,000 and 5% on the portion from £300,001 to £500,000, and is unavailable altogether where the price is over £500,000. It is also limited to buyers who intend to occupy the property as their main residence.
The definition is where it usually fails. HMRC's manual requires that the buyer has not previously acquired an interest in a dwelling or an equivalent interest in land situated anywhere in the world, including by inheritance or gift. If you have ever owned a home in the US, even one sold years ago, you are not a first-time buyer for SDLT. In a joint purchase, every buyer must meet the conditions.
To show how the layers combine, take a £1.2 million London flat bought by an individual who keeps a home in the US and has not been in the UK for 183 days in the previous 12 months. Using the bands currently published on GOV.UK:
The total is £147,750, well over double the standard figure. If that buyer then sold the US main home within 3 years and spent 183 days in the UK within the qualifying window, both surcharges could potentially be recovered through the refund routes above. This is arithmetic at today's published rates only; your figure depends on the facts and on the rates in force on your completion date.
Holding a UK home in a company is treated harshly. Certain corporate bodies pay 17% on residential property costing more than £500,000, and the 2% non-resident surcharge can apply on top. Reliefs exist, for example for property rental businesses, developers and traders, but a home occupied by the owner or their family generally sits outside them.
A company also brings the Annual Tax on Enveloped Dwellings and US reporting questions, covered in ATED and US owners.
A US citizen or green card holder is taxed on worldwide income, so the eventual sale is a US tax event. SDLT fits in as follows.
It is not deductible as a tax. IRS Topic 503 lists transfer taxes and stamp taxes among the taxes you cannot deduct on Schedule A. SDLT is a tax on a land transaction, not a property tax on value, so it does not become an itemised deduction.
It is not creditable. The foreign tax credit is generally available only for income taxes paid or accrued to a foreign country, or taxes in lieu of an income tax. SDLT is neither.
It generally goes into basis. IRS Publication 551 lists the settlement costs that are included in the basis of property you buy, and transfer taxes are on that list, alongside legal fees, recording fees, surveys and owner's title insurance. Costs of obtaining a mortgage are not. SDLT paid on a purchase therefore generally increases the property's US cost basis, which reduces the US gain when you sell.
Two practical consequences follow. First, the SDLT figure should be recorded in dollars at the time it was paid, because US gain is measured in dollars, and currency movement between purchase and sale produces its own result. Second, if any surcharge is later refunded, the basis should reflect the tax you actually bore rather than the amount first paid. Keep the SDLT return, the completion statement and any refund correspondence with your permanent property records. The sale itself, including the main-home exclusion and UK capital gains tax, is covered in selling UK property as a US citizen.
The surcharges depend on facts you can sometimes still influence before exchange: whose name goes on the title, whether and when a US home is sold, and when completion falls relative to your arrival. We map the SDLT layers before exchange, set up the refund claims that are likely to arise, and carry the SDLT paid into the US basis records so that the eventual sale is reported correctly on both sides. A licensed CPA or Enrolled Agent reviews and signs off every US filing; the UK side is reviewed by an ACCA-qualified accountant. Our US-UK expat tax service is built for families moving between the two systems. If you are about to buy, book a confidential consultation before you exchange.
This article is general information, not tax or legal advice, and does not create a professional relationship. SDLT rates, bands and reliefs change at fiscal events, so check the rates in force on your completion date against current GOV.UK guidance and take advice on your own facts before you act.
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Reviewed by a CPA / Enrolled Agent. Last updated: 21 September 2026.
Official sources: GOV.UK Stamp Duty Land Tax | GOV.UK SDLT residential property rates | GOV.UK higher rates for additional properties | GOV.UK SDLT rates for non-UK residents | GOV.UK repayment of the non-UK resident surcharge | HMRC SDLTM29845 | GOV.UK SDLT for corporate bodies | IRS Publication 551 | IRS Topic 503 | IRS Topic 856