When a company — or another non-natural person, such as a partnership with a corporate member — buys a dwelling, SDLT works differently from an individual purchase. The company always pays the higher rates for additional dwellings, and on a dwelling costing more than £500,000 a flat rate of 17% can apply to the whole price.
Higher rates on every company purchase
A company buying a dwelling for £40,000 or more pays the higher rates (5% above standard) whether or not it owns other property. There is no first-time buyer relief and no replacement-of-main-residence exemption for companies.
When does the 17% flat rate apply?
On a dwelling costing more than £500,000, a single rate of 17% applies to the entire price — not just the slice above £500,000. It was 15% for completions before 31 October 2024.
Worked examples
| Purchase by a UK company | SDLT |
|---|---|
| £400,000 dwelling (higher rates) | £30,000 |
| £600,000 dwelling, no relief (17% flat) | £102,000 |
| £600,000 dwelling, relief claimed (higher rates) | £50,000 |
How can a company avoid the 17% rate?
The flat rate does not apply — and the higher rates are charged instead — where the company buys the dwelling for a qualifying business, including:
- a property rental business letting to unconnected tenants;
- property developers and property traders buying to develop or resell;
- properties open to the public for at least 28 days a year;
- farmhouses occupied by farm workers, and housing for employees.
The relief must be claimed on the return and can be withdrawn if the property is used by someone connected with the company within three years.
Annual Tax on Enveloped Dwellings
Companies owning UK dwellings worth over £500,000 may also need to file annual ATED returns. The same business reliefs generally apply, but they must be claimed each year.
Non-resident companies
A non-resident company also pays the 2% non-resident surcharge — 19% instead of 17% on the flat rate. A £600,000 dwelling with no relief would cost £114,000.
This guide summarises HMRC's published rules for guidance. Company purchases often involve linked transactions and group reliefs — take advice before exchanging.