Top 5 Reasons Your Stamp Duty Might Have Been Overpaid

Stamp Duty Land Tax (SDLT) is one of the biggest upfront costs when buying property in England or Northern Ireland. But what many people don’t realise is that it’s often overpaid - sometimes by thousands of pounds. HMRC doesn’t automatically alert you if you’ve paid too much, meaning millions in unclaimed refunds are left on the table each year.

Here are the top 5 reasons your stamp duty might have been overpaid, and what to do if you think you’re eligible for a refund.

1. You Were Charged the 3% Second Home Surcharge by Mistake

The 3% SDLT surcharge applies to second homes and buy-to-let properties - but it's not always applied correctly. It’s often wrongly added in situations like:

• You sold your previous main home shortly after buying the new one
• You inherited a property but didn’t purchase it
• You temporarily owned two homes during a move
• Your partner’s property triggered the surcharge in error

If this surcharge was wrongly added, you could be due a full or partial refund, especially if you sold your previous main home within 36 months of buying the new one.

2. The Property Was Mixed-Use, Not Fully Residential

Mixed-use properties - those that include both residential and non-residential elements - qualify for lower, non-residential SDLT rates.

This applies in cases such as:

• A flat above a commercial shop
• Homes with outbuildings used for business
• Farmhouses with grazing land or paddocks
• Bed and breakfasts or live/work spaces

If your solicitor treated the property as fully residential, you may have overpaid SDLT and could be eligible for a reclaim.

3. The Property Qualified for a Non-Residential Rate

Some properties don’t clearly fall into residential or mixed-use categories. If the land includes commercial elements, such as:

• Agricultural land
• Woodland
• Storage or yard space
• A workshop or stable

…it may have been eligible for non-residential rates, even if there’s a home on the land. Overpaying in these cases is common, especially when buyers rely solely on standard solicitor SDLT calculations.

4. An Error Was Made in the SDLT Calculation or Filing

Sometimes, the issue is simply a mistake during the transaction. SDLT calculations can be complex, especially for larger or unusual property deals. Common errors include:

• Applying the wrong SDLT rate
• Using out-of-date thresholds
• Forgetting to apply reliefs (such as for first-time buyers)
• Misclassifying the property type

These errors can easily go unnoticed - and HMRC rarely questions overpayments.

5. You Didn’t Receive Specialist Tax Advice at the Time of Purchase

Most people assume their solicitor or conveyancer will handle stamp duty correctly, but SDLT isn’t their area of expertise. Their priority is completing the transaction, not optimising your tax position.

Without a specialist SDLT review, many buyers miss legitimate refund opportunities. A quick review from an experienced SDLT adviser could reveal that you’re owed thousands back.

How to Check If You’re Owed a Stamp Duty Refund

The good news? You can still reclaim overpaid SDLT - even up to four years after completing your property purchase.

At SCA Tax, we specialise in SDLT refund claims. Our team will review your transaction and, if we find an overpayment, we’ll handle the full reclaim process with HMRC from start to finish.

Start your free assessment here.