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Where Taxpayers and Advisers Meet

Transferring BTL into a company to realise main residence opportunity.

Allijames
Posts:2
Joined:Sat Apr 10, 2021 5:34 pm
Transferring BTL into a company to realise main residence opportunity.

Postby Allijames » Sat Apr 10, 2021 6:01 pm

Hello all

Hoping for some advice with the position I’m in below. I’ve read some of the gov SDLT manual alongside a heap of the threads here today but I can’t see an identical question posed, but apologies if I’ve missed one.

My sister and I own a flat but no other properties. I lived in it from 2016- Sep2020. At that point, I moved out of the property and into rental accommodation with my girlfriend where we continue to live today. The flat I own with my sister was let out to tenants in sep2016 and remains let to them today.

My girlfriend and I are now looking to buy a place together. My sister and I do not wish to give up our flat.

I understand that if my girlfriend and I buy a place, we will be liable for 3% SDLT surcharge on that property, as it will be an additional property.

My questions are:

1. If my sister and I transfer our flat into a limited company (where we are the two shareholders) does that transaction attract SDLT, and the SDLT 3% surcharge?

2. If the flat my sister and I own is transferred to a limited company, are we then able to buy a property each as our main residences without attracting the SDLT surcharge on those properties ? I’ve seen the conditions in the gov SDLT manual but can’t work out if our ownership in the shares of a BTL ltd company which owned our flat would mean we meet condition C and have a ‘major interest’ in ‘another dwelling’.

Any advice would be gratefully received as I’d love to transfer to the company before the June 2021 deadline if it makes sense too.

Fingers crossed someone can help

Kind regards

Alli

bd6759
Posts:4262
Joined:Sat Feb 01, 2014 3:26 pm

Re: Transferring BTL into a company to realise main residence opportunity.

Postby bd6759 » Mon Apr 12, 2021 10:27 am

1. Yes (based on market value)

2. Yes

Allijames
Posts:2
Joined:Sat Apr 10, 2021 5:34 pm

Re: Transferring BTL into a company to realise main residence opportunity.

Postby Allijames » Mon Apr 12, 2021 11:21 am

Thanks very much bd6759 :)


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