New 3% Stamp Duty tax

seaspray10

We were told that this new tax only effected people buying either investment properties or second homes but as a tenant who also has investment properties, I now find that I will have to pay 3% Stamp Duty on the full amount (on top of the normal SD) when I buy my first residential home.
See question and response below from HMRC:
Hi,

I was wondering if you could please clarify something for me. Myself and my wife own and rent out buy to let properties but our main residence is a property we rent off my mother in law and have done so for the last
2 years. We are looking to purchase this house off her later this year (at market value) and therefore we will go to owning our own main residence as opposed to being tenants in it. I have read the consultation document about the change and cannot clarify where we stand as we are not replacing a main residence in the scenario of selling and buying discussed in the document. We will own one more property at the end of the transaction than we started with but will go from OWNING no main residence to OWNING one. We can provide clear evidence that we have lived in the house for the last 2 years.
Please can you clarify if the new higher rate of an additional 3% would apply to this transaction.

Thanks and Regards
Martin


Dear Martin

In the circumstance you describe the higher rates will apply to the purchase of main residence for you and your family - see section 2.2 of the consultation.

Regards

(Text removed by MSE Forum Team)

marksoton

I wouldn't know if HMRC's interpretation is correct or not.

But if it is i fail to see why it should make any difference which way round the transactions occur.

You have ( multiple ) investment properties. The tax on that basis is changing.

It's like me complaining if income tax rates change, i have to pay it. At least you have options if you so wish to avoid paying the extra levy.

silvercar

You are increasing the number of properties you own, therefore you pay the extra SDLT. If you moved into one of your properties then sold it and at the same time bought your new home, you would probably get away with not having to pay the extra.

Pixie5740

What is your question OP? Are you doubting what HMRC have told you?

seaspray10

It's not a question or a complaint, just to let anyone else in my position know that they will be effected too, even though it was announced as a tax that wouldn't be levied on residential homes.

carpediemspirit

I would suggest letting your MP know your disdain and replying to jane to give her feedback on the consultation.

marksoton

seaspray10 wrote: »

It's not a question or a complaint, just to let anyone else in my position know that they will be effected too, even though it was announced as a tax that wouldn't be levied on residential homes.

It's not levied on residential property though.

I hope you conduct your BTL business in a more professional way than you do this issue.

seaspray10

I have been informed by HMRC that this levy will apply to the purchase of our first residential home, as we have other investment properties.


Your second comment is totally unjustified.

marksoton

seaspray10 wrote: »

I have been informed by HMRC that this levy will apply to the purchase of our first residential home, as we have other investment properties.


Your second comment is totally unjustified.

So deal with it. It's happening. Conversely i bet you'd use any government help for that first residential purchase....

Not really. If i ran a property business i'd have made sure i was appraised of this months ago.

seaspray10

I have dealt with it and I'm letting others in my position know what the situation is, so they may have time to deal with it too.
You may bet that I would use any government help available but you would loose that bet.
I do not run a property business.
You're making an awful lot of assumptions, in a very negative and aggressive way, towards someone you know nothing about.

marksoton

seaspray10 wrote: »

I have dealt with it and I'm letting others in my position know what the situation is, so they may have time to deal with it too.
You may bet that I would use any government help available but you would loose that bet.
I do not run a property business.
You're making an awful lot of assumptions, in a very negative and aggressive way, towards someone you know nothing about.

Well i would so you're foolish if you don't.

You have numerous BTL properties but it's not a business?

Either us taxpayers are being robbed or you're running a yield that doesn't work out then... Which is it?