Second homes and buy to let (2026): what the purchase costs in Portugal, Spain and England
England is the only one of the three with a surcharge for owning another home: 5% of the price on top of stamp duty, counting homes anywhere in the world. Portugal charges a higher IMT table on a home that is not the buyer's own permanent home, and a flat 7.5% to non-residents. Spain charges its normal transfer tax, but the reduced rates for main homes do not apply.
Key facts
- England: 5% of the price on top of SDLT if the buyer will own another home worth £40,000 or more, anywhere in the world.
- England's surcharge depends on what the buyer owns, not on what the home is for: a first buy to let pays the standard rates.
- Portugal: second homes and investment property use the 'other housing' IMT table, which has no zero band; non-residents pay a flat 7.5%.
- Spain: the same transfer tax as for a main home, without the regional main-home reductions.
- The surcharge in England comes back if the purchase replaces a main home sold within 3 years.
Is there extra tax on a second home?
Only England has a surcharge for owning another home. Portugal and Spain change the rate by what the home is for:
| England | Portugal | Spain | |
|---|---|---|---|
| What decides it | Whether the buyer will own another home | Whether this is the buyer’s own permanent home | Whether this is the buyer’s main home |
| Second home, resident buyer | Bands plus 5% of the price | IMT “other housing” table, from 1% | Normal transfer tax, no main-home reduction |
| Second home, non-resident buyer | Bands plus 5% plus 2% | Flat 7.5% IMT | Same as a resident |
| First buy to let, buyer owns nothing else | Standard bands | “Other housing” table | Normal transfer tax |
What does a second home cost in each place?
A resident buyer who already owns a home, buying a resale second home at the same euro price:
| Rank | Place | Buyer | Taxes | Fees, typical | Total on top | Share of price |
|---|---|---|---|---|---|---|
| 1 | Portugal, Madeira | Second home, tax-resident, price €300,000 | €11,656.85 | €4,125 | €15,781.85€15,031.85 to €18,356.85 | 5.26% |
| 2 | Portugal (mainland) | Second home, tax-resident, price €300,000 | €14,005.50 | €4,125 | €18,130.50€17,380.50 to €20,705.50 | 6.04% |
| 3 | Spain, Madrid | Resale, second home, price €300,000 | €18,000 | €4,148.54 | €22,148.54€20,348.54 to €24,248.54 | 7.38% |
| 4 | Spain, Andalusia | Resale, second home, price €300,000 | €21,000 | €4,148.54 | €25,148.54€23,348.54 to €27,248.54 | 8.38% |
| 5 | Spain, Valencian Community | Resale, second home, price €300,000 | €27,000 | €4,148.54 | €31,148.54€29,348.54 to €33,248.54 | 10.38% |
| 6 | Spain, Catalonia | Resale, price €300,000 | €30,000 | €4,148.54 | €34,148.54€32,348.54 to €36,248.54 | 11.38% |
England works in pounds, so it is shown at its own prices. Compare the share of the price; amounts are never converted:
| Price | Taxes | Fees, typical | Total on top | Estimate range | Share of price |
|---|---|---|---|---|---|
| £150,000 | £8,000 | £1,450 | £9,450 | £8,850 to £10,050 | 6.30% |
| £300,000 | £20,000 | £1,500 | £21,500 | £20,900 to £22,100 | 7.17% |
| £500,000 | £40,000 | £1,500 | £41,500 | £40,900 to £42,100 | 8.30% |
| £1,000,000 | £93,750 | £1,645 | £95,395 | £94,795 to £95,995 | 9.54% |
England’s surcharge applies from the first pound, so its share of the price is already high on a cheap second home, and it keeps rising with the price. See Spain or England and second home in Portugal or England.
What changes for a non-resident?
A buyer who lives in another country pays Portugal’s flat rate and England’s 2% surcharge on top of the rates above. Spain does not change:
| Rank | Place | Buyer | Taxes | Fees, typical | Total on top | Share of price |
|---|---|---|---|---|---|---|
| 1 | Spain, Madrid | Resale, second home, price €300,000 | €18,000 | €4,148.54 | €22,148.54€20,348.54 to €24,248.54 | 7.38% |
| 2 | Spain, Andalusia | Resale, second home, price €300,000 | €21,000 | €4,148.54 | €25,148.54€23,348.54 to €27,248.54 | 8.38% |
| 3 | Portugal (mainland) | Second home, not tax-resident, price €300,000 | €24,900 | €4,125 | €29,025€28,275 to €31,600 | 9.68% |
| 4 | Spain, Valencian Community | Resale, second home, price €300,000 | €27,000 | €4,148.54 | €31,148.54€29,348.54 to €33,248.54 | 10.38% |
| 5 | Spain, Catalonia | Resale, price €300,000 | €30,000 | €4,148.54 | €34,148.54€32,348.54 to €36,248.54 | 11.38% |
See non-resident buyers.
Does owning a home in one country matter in another?
Only for England. England’s higher rates count a home worth £40,000 or more anywhere in the world (Finance Act 2003, Schedule 4ZA, paragraph 17). A buyer who owns a flat in Lisbon pays them on a home in London, unless the London home replaces the Lisbon flat as their main home. Portugal and Spain look at the home being bought, not at what the buyer owns elsewhere.
Is buy to let taxed differently?
Not at purchase. In England, the higher rates depend on ownership, so a buy to let and a holiday home are taxed the same, and a first buy to let by someone who owns nothing else pays the standard bands. In Portugal and Spain, both are homes that are not the buyer’s main home. Income tax on rent differs a lot between the three, and is not covered here.
What this section does not cover
- Income tax on rent, capital gains tax and annual property taxes.
- Buying through a company, which has its own rates in each country.
- Holiday-let licensing and rental rules.
Places
- Buying a home in Lisbon, Porto or the Algarve (2026): are the costs different?
The purchase costs are the same anywhere on mainland Portugal. IMT, the 0.8% stamp duty and the Casa Pronta deed and registration fee are set nationally, so a home in Lisbon, Porto, Cascais, Faro or elsewhere in the Algarve costs the same to buy at the same price. What changes by municipality is IMI, the annual property tax, which each council sets between 0.3% and 0.45% of the tax value.
Buyer situations
- Stamp duty on a second home or buy to let in England (2026): the 5% higher rates
A buyer who will own more than one home at the end of the completion day pays the higher rates: 5% on top of every SDLT band, so 5% of the whole price extra. On a £300,000 second home that is £20,000 in stamp duty instead of £5,000. Homes owned abroad count. A buyer replacing their main home can avoid it, or claim it back if the old home sells within 3 years.
- Stamp duty refund on a second home in England (2026): getting the 5% higher rates back
Yes, when the new home replaced the buyer's main home. A buyer who still owned their previous main home at completion pays the 5% higher rates, then gets them back by selling or giving away that home within 3 years and claiming from HMRC within 12 months of the sale, or of the new home's return filing date if later. On a £400,000 home the refund is £20,000. A holiday home or buy to let bought while keeping the main home gets no refund.
- Buying a second home or an investment property in Portugal (2026): IMT and other costs
A home that will not be the buyer's own permanent residence, such as a holiday home or a home to let, pays IMT on the 'other housing' table: 1% up to €106,346, rising through 2%, 5%, 7% and 8% bands to a single 6% from €633,931 and 7.5% above €1,150,853, plus 0.8% stamp duty. A non-resident buyer pays a flat 7.5% instead.
Costs by price
- Buying costs in England by price (2026): stamp duty and fees from £150,000 to £1.5 million
For a buyer who owns no other home, stamp duty in England is £1,500 on a £200,000 home, £5,000 at £300,000, £15,000 at £500,000 and £43,750 at £1 million. First-time buyers pay less up to £500,000, buyers who already own a home pay 5% of the price more, and non-residents 2% more.
Comparisons
- Where buying costs are lowest: Portugal, Spain or England (2026)
For a tax-resident buyer of a main home, Madeira and the Azores have the lowest buying taxes of the euro places on cheaper and mid-priced homes, then mainland Portugal; on expensive homes Madrid comes first. Catalonia has the highest. For a non-resident, Madrid comes first, because Spain has no non-resident surcharge and Portugal charges a flat 7.5% IMT. For a new build, Portugal is cheapest. England, in pounds, takes a small share of the price for a resident home mover, but a large one for a buyer who already owns a home.
- Spain or England (2026): where does buying a home cost more?
For a resident buying their main home, England's stamp duty is a smaller share of the price than Spain's transfer tax, because England's bands start at 0% while Spanish regions charge 6% to 10% or more from the first euro. A buyer who already owns a home anywhere pays 5% extra in England from the first pound, so a second home in England can cost more than one in Madrid or Andalusia. New builds cost more in Spain, where they pay 10% VAT.
- Second home in Portugal or England (2026): which costs more to buy?
A UK resident who already owns a home and buys a second one pays England's standard bands plus 5% of the price. The same buyer in Portugal is a non-resident there, so they pay a flat 7.5% IMT plus 0.8% stamp duty. On cheaper homes England usually takes the smaller share of the price; as the price rises England's share climbs past Portugal's flat rate. A buyer who moves to Portugal within two years can reclaim most of the IMT.
Questions people ask
Which country charges the least tax on a second home?
For a buyer resident in the country, Portugal usually charges the least, then Madrid. England's 5% surcharge applies from the first pound, so a cheap second home there carries a high share in tax. For a non-resident, Madrid and Andalusia come out lowest.
Is there a second home surcharge in Spain or Portugal?
Not as such. Spain charges the same transfer tax on any resale, but main-home reductions are lost. Portugal uses a higher IMT table for homes that are not the buyer's own permanent home, and a flat 7.5% for non-residents.
Does owning a home abroad count for England's 5%?
Yes. The higher rates count any home worth £40,000 or more anywhere in the world, so a buyer who owns a home in Portugal or Spain pays them on a purchase in England, unless it replaces their main home.
Is buy to let taxed differently from a second home?
Not at purchase in any of the three countries on this site. In England both depend on whether the buyer owns another home; in Portugal and Spain both pay the rates for a home that is not the buyer's main home.
Sources
- Stamp Duty Land Tax: buying an additional residential propertyGOV.UK (HM Revenue and Customs)
- Finance Act 2003, Schedule 4ZA (higher rates for additional dwellings)legislation.gov.uk
- Código do IMT, article 17 (rates)Autoridade Tributária e Aduaneira (Portugal)
- Real Decreto Legislativo 1/1993, Impuesto sobre Transmisiones Patrimoniales y Actos Jurídicos DocumentadosBoletín Oficial del Estado (Spain)