Additional SDLC

mp80

Hi there

I currently own, but do not live in (and have not lived in for 5+ years) a property, which is unfurnished, not rented out or anything.

I got married last year, and my wife already owned the home. I've lived there for 3 years now. Before this I lived with my ex-GF in another house (not the one above) for 18 months. We would like to add myself to the mortgage and release some equity to pay back my wife's parents who provided funds for her to do some renovations.

Neither property was subject to SDLC (it's good living up North!)

However, I read today, that adding myself to what will be a new mortgage on this property could expose us to £3,750 of SDLC at the higher rate (3%) as I own another residential property.

However, would I be able to avoid this, as this property is clearly "main and only residence" and has been for years, and the other property is legally uninhabitable at the moment as it is totally unfurnished.

From my perspective seems like blatant government theft. I'll not bother adding myself on the mortgage if the case.

Thanks,
MP

martinsurrey

mp80 wrote: »

Hi there

I currently own, but do not live in (and have not lived in for 5+ years) a property, which is unfurnished, not rented out or anything.

I got married last year, and my wife already owned the home. I've lived there for 3 years now. Before this I lived with my ex-GF in another house (not the one above) for 18 months. We would like to add myself to the mortgage and release some equity to pay back my wife's parents who provided funds for her to do some renovations.

Neither property was subject to SDLC (it's good living up North!)

However, I read today, that adding myself to what will be a new mortgage on this property could expose us to £3,750 of SDLC at the higher rate (3%) as I own another residential property.

However, would I be able to avoid this, as this property is clearly "main and only residence" and has been for years, and the other property is legally uninhabitable at the moment as it is totally unfurnished.

From my perspective seems like blatant government theft. I'll not bother adding myself on the mortgage if the case.

Thanks,
MP

this additional SDLT rate was added to stop people just holding on to empty properties, which is exactly what you are doing, why not sell this empty house that you've not lived in for years, so someone cal call it home.

mp80

martinsurrey wrote: »

this additional SDLT rate was added to stop people just holding on to empty properties, which is exactly what you are doing, why not sell this empty house that you've not lived in for years, so someone cal call it home.

Because it's not in a habitable state at the moment and needs work before it can be sold. I don't have the time to deal with it right now.

mp80

Some ray of hope I read on a property site (albeit not HMRC) "If the property being purchased is to be the person’s main residence, irrespective of how many other buy-to-let properties they may own, they will avoid paying the premium."

p00hsticks

mp80 wrote: »

Some ray of hope I read on a property site (albeit not HMRC) "If the property being purchased is to be the person’s main residence, irrespective of how many other buy-to-let properties they may own, they will avoid paying the premium."

That's not correct - the HMRC legislation is quite clear. The above is only true if the person is moving from their existing main residence to a new one, which you are not.

mp80

So will I have to pay if I proceed to take equity in the current property?

mp80

Another question - if I choose not to take title, but keep my wife as the sole owner, will that mean we're not liable for additional SDLC? She does not have any interest in the existing property, although I'm unsure if it's automatic as we're married?

mp80

It's even less clear now, as I had an interim property between the one I own now and the one I am taking equity in , which was my main residence, and was sold. Therefore according to the handy flowchart at https://www.gov.uk/government/consultations/consultation-on-higher-rates-of-stamp-duty-land-tax-sdlt-on-purchases-of-additional-residential-properties/higher-rates-of-stamp-duty-land-tax-sdlt-on-purchases-of-additional-residential-properties

I'm not liable to pay higher SDLC as I own 2+ properties, this one is replacing my previous main residence, which was sold before the legislation came into effect ...

... or not.