The SDLT surcharge for purchasing through a limited company does NOT apply to commercial property
The SDLT surcharge for purchasing through a limited company does NOT apply to commercial property—only residential transactions attract the additional 3% rate.
The SDLT surcharge for purchasing through a limited company does NOT apply to commercial property—only residential transactions attract the additional 3% rate.
When purchasing property in the UK via a Special Purpose Vehicle (SPV) limited company, investors are automatically hit with a 3% Stamp Duty Land Tax (SDLT) surcharge on all residential properties, regardless of whether it is the company's first acquisition. This drastically increases the entry costs for buy-to-let investments. However, the SDLT framework treats commercial properties entirely differently.
Commercial property purchases do not attract the 3% residential surcharge. Furthermore, commercial SDLT is charged at 0% on the first £150,000 of the purchase price, 2% on the next £100,000, and a maximum of 5% on anything above £250,000. For an investor acquiring a £400,000 property, a residential buy-to-let would incur £21,500 in SDLT (including the surcharge), whereas a commercial property would incur only £9,500. This £12,000 saving is a primary reason many seasoned investors pivot toward commercial or mixed-use assets.