Stamp Duty: First time Buyer Marries Homeowner + new property

James_Day

Hi,

I am hoping that this thread can clear up my confusion where I stand with stamp duty rates and tax, I have done a lot of research on the web only to find conflicted answers and some of whom were solicitors.

The scenario is this:

I have been saving as a first time buyer to buy my own home for about 10 years, I recently married my partner who already owns a property (the property and mortgage are solely in her name on the deeds etc. and i consider this her property and not mine - even in the event of divorce).

Since marriage my plan was to buy my own home (solely my name on the deeds and mortgage etc,) separate to my wife as we like our own space and storage and I work away alot etc. - you could say we are not that traditional.

To my shock I have recently learnt during a conversation with someone that as I am married not only am I not considered a first time buyer anymore that also this would be considered a second home (even though my wife and I deem our finances to be separate and the property is in her own name) and hence I would have to pay higher rate of stamp duty should i buy my own house (i.e. it would be around 10k stamp duty tax) which is not feasible for me as I can't just throw that sort of money away to the government. I seemed to have jumped from saving for my first home as a first time buyer, to a buyer of a second home just for being married.

What happens if I separate from my partner? does this mean I would still have to pay higher rate of stamp duty tax if I bought a home (it would be 10k ish) unless we were divorced? This feels very harsh to me as I was saving for my first home before marriage, and as I moved into my wife's home I would leave 'her' property upon separating - I would have to pay the higher rate of stamp duty while separated until divorced would mean I am locked out of buying a house (that i would consider my first house) and I would have to rent again. Not sure if this would violate some sort of human right?

If I get divorced would I then be considered a first time buyer again for stamp duty purposes and be exempt from stamp duty tax? or because I have been married to a homeowner (even if they 100% keep their house and 0% to me) will I never be classed as a first time buyer ever again for stamp duty purposes?

I am not sure if anything I have said is true or not at this stage - its a bit of a confusion at the moment but would like to know where I stand before looking for a house on my own to see if this is feasible for me anymore.

Thanks in advance.

SDLT_Geek

As things stand, when you buy the higher rates would be due.

If someone in a similar position to you was separated from their spouse in circumstances likely to prove permanent they would qualify as a first time buyer.

If someone in a similar position to you was divorced from their spouse they would qualify as a first time buyer.

This is all hypothetical presumably, given that you have only just married.

trailingspouse

On a separate post, a couple of weeks ago, someone was criticised for asking what the score would be financially if he (hypothetically) married and then divorced. He was shot down in flames for being unromantic.
But I made the point on that thread, and I'll make it again here - real life is not like a Disney movie. We all need to get much more clued-up about precisely how being married will affect us financially, and have those conversations with the people we want to share our life with.

I think you, OP, have had that conversation, and the two of you are being very straightforward with each other about wanting to retain your financial independence. Unfortunately the system isn't set up to cope with it.

AdrianC

A married couple is treated as a single entity for SDLT.

Even disregarding the marriage, if the two of you were to buy as joint owners, then there is a non-FTB in the purchase - who owns another property, so not only would there be no FTB discount on SDLT, but the +3% hike would apply.

Not sure if this would violate some sort of human right?

No, it really doesn't.

p00hsticks

trailingspouse wrote: »

I think you, OP, have had that conversation, and the two of you are being very straightforward with each other about wanting to retain your financial independence. Unfortunately the system isn't set up to cope with it.

The problem is that they don't appear to have had the conversation before they got married, which is when they should have - prior to marriage the OP could have bought his/her own property without all the hurdles and additional costs s/he now face.

davidmcn

SDLT_Geek wrote: »

This is all hypothetical presumably, given that you have only just married.

"Sorry darling, I'm going to have to dump you for tax reasons."

00ec25

James_Day wrote: »

Not sure if this would violate some sort of human right?.

please do not trivialise a vital concept for the sake of your financial greed

your research should easily have confirmed:

a) co-ownership means the rules are tested against each individual alone. If one fails then both fail together. Does not matter if the co-owners are married or not in that context.

b) if you buy as sole owner, you are tested as sole owner.

-taff

James_Day wrote: »

Not sure if this would violate some sort of human right?.

Paying more tax is not a violation of a basic human right...

sheramber

So you would ditch your wife for the sake of £10k?

xylophone

wanting to retain your financial independence.

Seems to be more than that going on here....

Since marriage my plan was to buy my own home (solely my name on the deeds and mortgage etc,) separate to my wife as we like our own space and storage and I work away alot etc. - you could say we are not that traditional.

You'd wonder why they bothered to get married.....can it have been for tax reasons......:)

Beeper

Hi everyone!

So this came up yesterday at the Christmas lunch. Everyone (but me) said ‘if you’re the only one named on your property, the spouse can buy a second property and still be a first time buyer and qualify for SDLT if they make it their main residence’. I said that wouldn’t be the case, as a married couple you’d both have an interest in property number one and so not qualify for SDLT. The majority vote won and I was promptly shot down.

I’ve read the gov. doc, first time buyer definition:
‘In order to count as a first time buyer, a purchaser must not, either alone or with others, have previously acquired a major interest in a dwelling or an equivalent interest in land situated anywhere in the world.’

But can’t find anything that says a married couple would be assessed a single unit for SDLT. Where would this be? Thanks