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How to avoid stamp duties during buying a two house as a first buyer?
Poniato
Posts: 72 Forumite
Hello,
I'm in the process of buy two houses in same time. The first house is as a first buyer, the second house is a buy to let. Would be possible to avoid stamp duties in this situation? Price of both houses is much lower than 300k. I know it's tricky but possible.
I'm in the process of buy two houses in same time. The first house is as a first buyer, the second house is a buy to let. Would be possible to avoid stamp duties in this situation? Price of both houses is much lower than 300k. I know it's tricky but possible.
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Comments
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If you buy the Buy to let first you pay normal rate stamp duty and then normal rate stamp duty on the residential.
If you buy the residential first, you pay no stamp duty but you pay the higher rate on the BTL.
Or at least that is my understanding, but I could be wrong.
Have you asked the solicitor you plan on using for the conveyancing?I am a Mortgage AdviserYou should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0 -
I don't see how you can avoid paying the double stamp duty on the BTL (the second property). To claim the free stamp duty below £300k on the FTB house you have to declare you have never owned a property before.I’m a Forum Ambassador and I support the Forum Team on the Debt free Wannabe, Budgeting and Banking and Savings and Investment boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com. All views are my own and not the official line of MoneySavingExpert.
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When you complete on the second property you will pay the extra 3%.
You need to purchase these properties in the best order to minimise your SDLT. Speak to your solicitor.I am a Mortgage Broker
You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0 -
[FONT=Verdana, sans-serif]I think the cheapest way is to buy the residential as a FTB free of stamp duty 1st then pay the extra 3% on the BTL. I can't see how you can do it any cheaper.[/FONT]0
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If you buy the Buy to let first you pay normal rate stamp duty and then normal rate stamp duty on the residential.
If you buy the residential first, you pay no stamp duty but you pay the higher rate on the BTL.
Or at least that is my understanding, but I could be wrong.
Have you asked the solicitor you plan on using for the conveyancing?
You are half right. The higher rate of SDLT applies when someone purchases an additional residential property. The fact the OP would live in the property as a main residence is irrelevant it's the fact that it's an additional residential property that's important. A simple way to look at it is at the start of the transaction the OP would own 1 residential property and at the end (s)he would own 2 residential properties. 2 is greater than 1 so the higher rate applies.0 -
Hello,
I'm in the process of buy two houses in same time. The first house is as a first buyer, the second house is a buy to let. Would be possible to avoid stamp duties in this situation? Price of both houses is much lower than 300k. I know it's tricky but possible.
No OP it is not possible to avoid paying SDLT on both purchases. Not tricky or difficult but impossible if you plan on having a beneficial interest in both properties and those beneficial interests are worth more than £40k.
There is a less expensive way of doing it and a more expensive way. Assuming both properties are worth roughly the same the least expensive way is to purchase the main residence as a FTB using the SDLT relief for FTB and then purchase the BTL and pay the higher rate of SDLT.0 -
FTB exemption only applies to the property you will reside in. I don't see how you can have two of those, so I concur with the others.
Purchase of main residence, exempt.
Purchase of second property, 3% surcharge on top of standard SDLT.I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.0
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