Globally Speaking | March 18, 2020

Budget 2020 Update

On 11 March 2020, Chancellor, Rishi Sunak’s first Budget, and the first following the United Kingdom’s departure from the UK, contained two tax announcements of particular interest to foreign investors in UK property.

1. 2% additional SDLT for non-UK purchasers

A Stamp Duty Land Tax (SDLT) surcharge of 2% will be introduced for non-UK resident buyers of English and Northern Irish residential property for completions from April next year.  

If a buyer moves to the UK after buying a property, they will be able to obtain a refund.

Where contracts are exchanged before 11 March 2020 but completion occurs after April 2021, no surcharge will apply.

The government’s consultation in February last year proposed that the surcharge would apply to non-resident companies, trusts and partnerships.  It would also apply to UK companies controlled by at least one non-resident individual.     

2. Updated ATED amounts

The ATED charges will increase for the year from April 2020 in line with inflation, as follows

Property valuePrevious year’s ATED – 2019/20 Upcoming year’s ATED – 2020/21
Over £500,000 to £1 million £3,650 £3,700
Over £1 million to £2 million £7,400 £7,500
Over £2 million to £5 million £24,800 £25,200
Over £5 million to £10 million £57,900 £58,850
Over £10 million to £20 million £116,100 £118,050
Over £20 million £232,350 £236,250


Readers may recall that the government (under former Prime Minister, Theresa May’s administration) had previously published details of a proposal to introduce a 1% SDLT surcharge in its February 2019 consultation document.  This proposal was side-lined at the time in the wake of ‘Brexit’ and is only now seeing the light of day, perhaps consistent with Mr Sunak’s mantra to ‘get it done’.

Further detail on the SDLT surcharge is expected in its response to the February 2019 consultation and draft legislation, including, we anticipate, clarity on the test the government are proposing to determine ‘non-resident’ status.  Readers will recall that we raised concerns about this test in our previous article published on 19 February 2019.

The taxation of property is an increasingly technical area, and specific advice should be sought in a timely manner in advance of a proposed investment.