I was wondering if this policy has some odd effects... or if I'm just misunderstanding how it works
Mr A has never owned his main residence. He has lived with his elderly parents and travelled extensively for work (staying in hotels). His parents' home has always been his main residence. He bought a buy-to-let flat many years ago but does not own any other property.
He is now planning to buy a main residence.
A) The flat will cost £160,000.
B) It is a share of freehold, with the leasehold element being for 75 years.
C) He is planning to keep the buy-to-let flat.
D) The flat will become his main residence.
1. Is Mr A liable for SDLT additional rate? (The legislation and HMRC guidance seem to have some confusing punctuation and syntax...?)
2. If he is, how can he avoid the SDLT additional charge without selling his buy-to-let?
3. Other things being equal, is he worse off (from a tax point of view) than someone who previously owned a main residence and a buy-to-let, who then sold their main residence and bought a new one? (It seems unfair that to get to the point of owning a home and having an investment, someone who has previously not owned their home would be penalised.)
Any answers/comments/suggestions gratefully received.
HMRC manual https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm09730