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Where Taxpayers and Advisers Meet

second property stamp duty ?

Olga S
Posts:16
Joined:Wed Feb 10, 2016 12:55 pm
second property stamp duty ?

Postby Olga S » Mon Apr 03, 2017 9:27 pm

Dear all,

Some advice would be greatly appreciated regarding stamp duty as I am confused about whether I am liable for the additional 3%.

On 1st April 2016 at the time of the introduction of the new stamp duty charges, my husband and I owned 2 properties neither of which we were currently living in due to multiple relocations due to work (junior doctor). We were in rented accommodation at the time close to the hospital I worked in.

Whilst living in the rented accommodation, I sold the last home I owned and lived in for 4 years (before moving into rented) on 8th July 2016 (This was in Norwich and I worked in Essex at the time).

Around the end of July 2016 I moved back into my original home which I have owned since 1998, which had previously been rented out from 2009 until I moved back in again temporarily.

I am in the process of buying another property that will be my main residence. At this time, I do not want to sell the remaining property as I want to avoid being in a chain.

Since I owned 2 properties in April 2016, if I keep on my original house and sell it AFTER I purchase my new main residence, will I have to pay the higher rate of stamp duty. I am aware I can apply for a refund but was wondering if there is any way in avoiding the extra 3% in case I wanted to keep the original house on as an investment.

I have found conflicting and confusing information so far. The sale of my last main residence has been less than 18 months,

Any wisdom and clarification would be greatly appreciated.

Many thanks

maths
Posts:8507
Joined:Wed Aug 06, 2008 3:25 pm

Re: second property stamp duty ?

Postby maths » Tue Apr 04, 2017 12:25 pm

You refer to you and husband but then suggest only you are intending to buy a new property.

You also suggest you sold a property as if only you owned it.

Who owned the two properties one of which has now been sold?

Who is to buy the new property?

Did both you and husband live in both the properties?

Olga S
Posts:16
Joined:Wed Feb 10, 2016 12:55 pm

Re: second property stamp duty ?

Postby Olga S » Tue Apr 04, 2017 1:51 pm

Hello,

Thank you for your reply, Maths. We both own/owned, lived in the properties and will be purchasing the new property together...

Any insight will be appreciated.

maths
Posts:8507
Joined:Wed Aug 06, 2008 3:25 pm

Re: second property stamp duty ?

Postby maths » Tue Apr 04, 2017 2:00 pm

The intended purchase of the new property would constitute a replacement of your main/sole residence and thus no 3% charge. The new property must be intended to be your new residence.

The residence which is being replaced is the property you both sold in 2016 (in which it seems you both lived as your residence).

Olga S
Posts:16
Joined:Wed Feb 10, 2016 12:55 pm

Re: second property stamp duty ?

Postby Olga S » Tue Apr 04, 2017 7:16 pm

Thank you for your reply.

Just for clarification, by the time we buy the new property, we will still own the property we have been living in temporarily since July 2016 (therefore will own two properties until we sell the house we are living in now) , so we will not be liable for the extra 3% ? Is this due to the sale of our other property in April 2016?

My Solicitor says the house we are in now is our main residence so unless it it sold before we buy the new main residence we will be liable....

Please feel free to PM if you would prefer.

maths
Posts:8507
Joined:Wed Aug 06, 2008 3:25 pm

Re: second property stamp duty ?

Postby maths » Tue Apr 04, 2017 9:07 pm

Is this due to the sale of our other property in April 2016?
Yes.

This was I believe your/husband's sole or main residence.

Your present residence was not purchased after the sale of your other residence but was bought back in 1998 albeit now re-occupied.

Olga S
Posts:16
Joined:Wed Feb 10, 2016 12:55 pm

Re: second property stamp duty ?

Postby Olga S » Tue Apr 04, 2017 9:12 pm

Thank you, Maths.

Is there any way you can suggest I approach my solicitor with this information ? Or can you suggest another professional I can get to clarify this - perhaps an accountant ?

Suggestions much appreciated.

maths
Posts:8507
Joined:Wed Aug 06, 2008 3:25 pm

Re: second property stamp duty ?

Postby maths » Tue Apr 04, 2017 10:37 pm

Email your solicitor:

"I believe I do not satisfy Condition D contained in FA 2003 Sch 4ZA para 3(5) but I do fall within para3(6) and hence I am purchasing a dwelling which is a replacement for my only or main residence. In this regard notice of para 19(8) and (9) needs to be taken. Accordingly, the 3% SDLT charge does not apply to the proposed new purchase. My husband has always resided with me.

I await you comments as a matter of urgency."


Unless he can produce a satisfactory justification for his view (ie he is able to argue my view is incorrect) then inform him that if he continues to require you pay the 3% charge you intend to sue him for negligent advice.

It may be that others who post on this site may differ from my view (the legislation is not particularly easy to comprehend) so it may be worth waiting for others to comment. Nobody is perfect.

Olga S
Posts:16
Joined:Wed Feb 10, 2016 12:55 pm

Re: second property stamp duty ?

Postby Olga S » Wed Apr 05, 2017 7:17 pm

Thank you, Maths.

I'll try that and let you know what the outcome is.
Do you know if there is a way to contact HMRC directly ?

maths
Posts:8507
Joined:Wed Aug 06, 2008 3:25 pm

Re: second property stamp duty ?

Postby maths » Wed Apr 05, 2017 7:27 pm

I don't know any numbers. The Help Line are generally a waste of time and you cannot rely on their "advice". Google for a number.


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