Stamp duty 2nd property - confusion?

aseaofgreen

I appear to be in a unique and confusing situation regarding stamp duty on second homes.

After having read the government consultancy, the outcome, and the new policy i'm none the wiser!

The situation is as follows:

Husband A - Owns no property, lives in rental accommodation with new
Wife B (main residence for both).

Wife B - Owns property solely in her name, which is mortgaged, not a buy-to-let mortgage. Rented out to Tenants.

Husband A - is looking to buy his first property - solely in his name
- and both Husband A and wife B will move their main residence from
current rented accommodation to newly purchased property.

The policy states that it considers married couples as one entity,
even though Wife B solely owns a property in her name, and Husband A
will be purchasing solely in his name.

However, it also states on page 9@ gov.uk/government/uploads/system/uploads/attachment_data/file/508156/SDLT_summary_of_responses_final_14032016.pdf

"Purchasers buying their first property, replacing a main residence
(even if the purchaser owns more than one property) or buying an
additional property worth less than £40,000 will NOT be subject to the
higher rates."

So my question is will I (we) be required to pay the higher rate of
stamp duty on the 2nd property, even though it is not a 2nd home?

mrginge

Yes you will, unless the property you buy is less than 40k.

As a single entity you already own one property.
You will buy another. That is not a 'replacement of a main residence'

agrinnall

I'm pretty confident that as things stand you will have to pay the additional SDLT if what you say about a couple being treated as a single entity is correct. Your error is thinking that the extra duty is levied on second homes, it isn't, it's on second properties. And when you count up the number of properties you will own it's two.

franklee

I think so too. OP, The number of properties you own as one entity (husband and wife) will have increased by one.

If you were living in a martial home that you owned instead of rented and you sell that within the timescales then you will have sold one home and purchased another, the overall number remains the same so the added tax doesn't apply.

You could sell the rental to avoid the extra tax.

kinger101

Yes, you have to pay the higher rate. We had an almost identical scenario posted today. Have you posted it twice?

https://forums.moneysavingexpert.com/discussion/5452117

The replacing a main residence bit requires that you sell this property. So it doesn't apply to people currently renting.

marksoton

aseaofgreen wrote: »

Wife B - Owns property solely in her name, which is mortgaged, not a buy-to-let mortgage. Rented out to Tenants.



So my question is will I (we) be required to pay the higher rate of
stamp duty on the 2nd property, even though it is not a 2nd home?

Presumably wife B has consent to let yes?

You gotta pay up....

aseaofgreen

that previous post wasn't me, and i did a quick search but somehow missed it. Thanks for the info

aseaofgreen

Guess we shouldn't have gotten married

LisaLou1982

It wouldnt have mattered OP. We are in a v similar position, but not married and we are also subject to the additional SDLT

Mr.Generous

if you buy a home with a granny flat would that count as 2?

kinger101

Mr.Generous wrote: »

if you buy a home with a granny flat would that count as 2?

Not read the actual rules but it would seem it depends;

http://www.theguardian.com/money/2016/apr/16/stamp-duty-u-turn-brings-tax-relief-for-granny-flat-buyers