Does "Buy to Let Stamp Duty" Apply to Me?

Dagadog

Hi Collective Wisdom

I own my small house outright. My partner has a small mortgage on her flat, which we are currently renovating to rent out.

We are planning to move in together but neither property is big enough for us to live together. After selling my place, I will have enough capital to buy a larger property without a mortgage, so my intention is to buy the house in my name only where we both will live.

Given that my partner will continue to own her property which she will rent out, but is not involved financially in the purchase, will my purchase qualify as "Buying to Let" and attract the higher rate of stamp duty (a difference of £15,000)?

This is important as it will affect the price I'm able to pay.

maninthestreet

You will be living in the property, so how could it be considered a 'buy to let' ???

silvercar

If you are buying alone, with only your name on the deeds, then you won't have any extra BTL SDLT to pay. This assumes you are not married to your partner. Married couples only get one property between them, so her owning somewhere else and increasing the number of properties for her from 1 to 2 means that you will have the extra tax to pay.

What happens if you decide later to include her name as a joint owner is unclear.

G_M

maninthestreet wrote: »

You will be living in the property, so how could it be considered a 'buy to let' ???

IOP should have said "2nd property", not "buy to let".

But silvercar is right.

Dagadog

silvercar wrote: »

What happens if you decide later to include her name as a joint owner is unclear.

That's a good point. Is the tax on buying a 2nd property or on owning a second property?

How does it affect two people who meet, fall in love and move in together who both have their own home already? Would they pay stamp if they got married? Would it make a difference if one/both the houses were purchased before this change came in?

booksurr

Dagadog wrote: »

That's a good point. Is the tax on buying a 2nd property or on owning a second property?

How does it affect two people who meet, fall in love and move in together who both have their own home already? Would they pay stamp if they got married? Would it make a difference if one/both the houses were purchased before this change came in?

SDLT is based on consideration exchanged

for an exchange to happen there must be a transfer of value between both parties. So that means either one person buys out a share of the other person for cash OR one person is added on to an existing mortgage and therefore the original person has received value because their exposure to debt is now reduced

all is explained if you bother to look
https://www.gov.uk/stamp-duty-land-tax/overview

Dagadog

Ok, I think I get it. Only my name will be on the deeds of my house. Her flat will remain in her sole name. We will be mortgage free, thanks to an inheritance. We're not married, and have no plans in that direction.

Obviously, I'll check with the conveyancing solicitor when I do purchase somewhere, but I think we fall outside the 2nd home bracket.

kinger101

Dagadog wrote: »

Ok, I think I get it. Only my name will be on the deeds of my house. Her flat will remain in her sole name. We will be mortgage free, thanks to an inheritance. We're not married, and have no plans in that direction.

Obviously, I'll check with the conveyancing solicitor when I do purchase somewhere, but I think we fall outside the 2nd home bracket.

You right, except you use "we" where you mean "I". You'll own your own property. She'll own hers. BTW - many solicitors have been struggling to get their heads round the new rules.