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  • FIRST POST
    • Windsorcastle
    • By Windsorcastle 14th Sep 17, 3:39 PM
    • 484Posts
    • 264Thanks
    Windsorcastle
    Higher rate of stamp duty if current property not sold
    • #1
    • 14th Sep 17, 3:39 PM
    Higher rate of stamp duty if current property not sold 14th Sep 17 at 3:39 PM
    I am currently in the process of selling/transferring my share of my current home to my ex, with whom I still live (very unpleasantly!).


    I am also in process of buying a new flat on my own. My solicitor says that if I have not completed the transfer of the current property by the time I complete on the new one, I will have to pay the higher rate of SD, as it will be classed as a second home.


    Is this correct? Is there any period of grace allowed in this sort of situation? Presumably there are a lot of cases where someone has been unable to sell one property before they have to complete on another one...


    My ex is aware of this and is taking full advantage of the situation by dragging her heels so that it is becoming increasingly likely the transfer won't be completed in time. Is there anything I can do to avoid being hammered with the higher rate?
Page 1
    • cr1mson
    • By cr1mson 14th Sep 17, 3:48 PM
    • 764 Posts
    • 581 Thanks
    cr1mson
    • #2
    • 14th Sep 17, 3:48 PM
    • #2
    • 14th Sep 17, 3:48 PM
    If you sell your main home after you purchase your new home you’ll need to pay the higher rate. You can claim a refund of the higher rates if your old home is sold within 3 years of buying your new home.

    This is for England it is 18 months in Scotland.
    • Windsorcastle
    • By Windsorcastle 14th Sep 17, 3:54 PM
    • 484 Posts
    • 264 Thanks
    Windsorcastle
    • #3
    • 14th Sep 17, 3:54 PM
    • #3
    • 14th Sep 17, 3:54 PM
    If you sell your main home after you purchase your new home you’ll need to pay the higher rate. You can claim a refund of the higher rates if your old home is sold within 3 years of buying your new home.

    This is for England it is 18 months in Scotland.
    Originally posted by cr1mson


    Thanks. So in other words, I can just claim it back as long as I complete the transfer of the property to my ex within 3 years? That is a relief to know, thank you.
    • SDLT Geek
    • By SDLT Geek 14th Sep 17, 7:56 PM
    • 25 Posts
    • 11 Thanks
    SDLT Geek
    • #4
    • 14th Sep 17, 7:56 PM
    • #4
    • 14th Sep 17, 7:56 PM
    A short period of grace is allowed by HMRC in practice in this situation, even though it is not what the legislation says. See para 3.27 of the November 2016 guidance. This can be up to about four weeks, but depends on how soon your solicitor says they have to file the land transaction return after completion of the purchase and that can be dictated by lenders' requirements.
    • Windsorcastle
    • By Windsorcastle 20th Sep 17, 11:46 AM
    • 484 Posts
    • 264 Thanks
    Windsorcastle
    • #5
    • 20th Sep 17, 11:46 AM
    • #5
    • 20th Sep 17, 11:46 AM
    A short period of grace is allowed by HMRC in practice in this situation, even though it is not what the legislation says. See para 3.27 of the November 2016 guidance. This can be up to about four weeks, but depends on how soon your solicitor says they have to file the land transaction return after completion of the purchase and that can be dictated by lenders' requirements.
    Originally posted by SDLT Geek


    Thanks for this, that is useful to know. I will have another discussion with my solicitor about this.
    • G_M
    • By G_M 20th Sep 17, 8:48 PM
    • 41,978 Posts
    • 48,591 Thanks
    G_M
    • #6
    • 20th Sep 17, 8:48 PM
    • #6
    • 20th Sep 17, 8:48 PM
    A short period of grace is allowed by HMRC in practice in this situation, even though it is not what the legislation says. See para 3.27 of the November 2016 guidance. This can be up to about four weeks, but depends on how soon your solicitor says they have to file the land transaction return after completion of the purchase and that can be dictated by lenders' requirements.
    Originally posted by SDLT Geek
    https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/570876/SDLT_Higher_rates_for_additional_properties.pdf


    In the case of a disposal of a previous main residence following a purchase of a new main residence, the land transaction return will have been made based on the higher rates of tax, unless the disposal happened before the date on which the land transaction return must be submitted. In such a case the land transaction return should be completed as if the higher rates do not apply.
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