Does the 3% Surcharge Apply? Purchasing and Merging with the house next door as a main residence.

[Matthew Armstrong]

Hello experts,

Can anyone advise me on the following please? I have a BTL property and I live in my main residence which is also owned. I wish to purchase the house next door as a main residence merging it with my current main residence. In this instance will the SDLT surcharge apply? I am aware if I buy and sell a main residence on the same day I can avoid the surcharge, and likewise reclaim the tax if I buy a main residence and sell the old main residence at a later date, but how is the law applied in this instance?

I hope I have explained the situation adequately, but feel free to ask any clarifying questions.

thanks in advance

Matthew Armstrong

[bd6759]

In my opinion it will apply because you will own more than one property and you are not replacing your main residence. In this context, replacing requires that the old residence is sold.

[Matthew Armstrong]

Morning BD6759,

thanks for your opinion, is there grounds for reclaiming this surcharge, as I will end up with only one main residence? In a similar way to claiming back the surcharge once a previous main residence has been sold?

regards Matthew

[bd6759]

is there grounds for reclaiming this surcharge, as I will end up with only one main residence? In a similar way to claiming back the surcharge once a previous main residence has been sold?

No.

It doesn't matter how many residences you end up with. The relief applies when you replace a residence, and that requires selling your previous residence.