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Stamp Duty

Vmo07
Posts: 12 Forumite

Hi,
I am resident in UK and currently renting. I am considering to buy a house which will be my main residence in UK.
House is in England, approx, price 450000 GBP.
However, I own a flat abroad which is vacant and not my main residence any longer. Value of that flat in today's market is equivalent to about 25000 GBP.
Looking at SDLT rules, because I own a property abroad I do not qualify as a first time buyer.
Using SDLT calculator on GOV.UK website I find that SDLT for the house I will buy will be 26000 GBP, but if I sell my flat abroad within 3 years I can get refund of 13500 GBP.
So it appears beneficial to sell my flat abroad.
Is there any thing else I am missing here?
Is there any other rule / criteria I need to consider because value of the flat I own is less than 30000 GBP?
(I am asking this question because someone mentioned to me that different rule apply if the value of the property you currently own is less than 30000 GBP. But I can not find anything on GOV.UK website about any such rule / criteria while calculating SDLT)
I am resident in UK and currently renting. I am considering to buy a house which will be my main residence in UK.
House is in England, approx, price 450000 GBP.
However, I own a flat abroad which is vacant and not my main residence any longer. Value of that flat in today's market is equivalent to about 25000 GBP.
Looking at SDLT rules, because I own a property abroad I do not qualify as a first time buyer.
Using SDLT calculator on GOV.UK website I find that SDLT for the house I will buy will be 26000 GBP, but if I sell my flat abroad within 3 years I can get refund of 13500 GBP.
So it appears beneficial to sell my flat abroad.
Is there any thing else I am missing here?
Is there any other rule / criteria I need to consider because value of the flat I own is less than 30000 GBP?
(I am asking this question because someone mentioned to me that different rule apply if the value of the property you currently own is less than 30000 GBP. But I can not find anything on GOV.UK website about any such rule / criteria while calculating SDLT)
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Comments
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(I am asking this question because someone mentioned to me that different rule apply if the value of the property you currently own is less than 30000 GBP. But I can not find anything on GOV.UK website about any such rule / criteria while calculating SDLT)0
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Hi,
I am resident in UK and currently renting. I am considering to buy a house which will be my main residence in UK. House is in England, approx, price 450000 GBP. However, I own a flat abroad which is vacant and not my main residence any longer. Value of that flat in today's market is equivalent to about 25000 GBP. Looking at SDLT rules, because I own a property abroad I do not qualify as a first time buyer.
Correct, if when you acquired it, it was already a flat. However low its value, if you have previously acquired a dwelling, you are no longer a first time buyer.
It would be different if when you acquired it, it was say part of a shop and you converted it into a flat. If that is the background then first time buyers' relief might be available and the SDLT would be £7,500.
Using SDLT calculator on GOV.UK website I find that SDLT for the house I will buy will be 26000 GBP, but if I sell my flat abroad within 3 years I can get refund of 13500 GBP.
You are assuming the higher rates of SDLT apply because of you owning another flat. Given its value, that seems wrong. The SDLT would be £12,500 whether or not you sell your flat.
(I am asking this question because someone mentioned to me that different rule apply if the value of the property you currently own is less than 30000 GBP. But I can not find anything on GOV.UK website about any such rule / criteria while calculating SDLT)
There is an article about first time buyers' relief here: https://www.blakemorgan.co.uk/news-events/blog/sdlt-first-time-buyers-relief/0 -
Hi Vmo, I was in almost the exact same position as you when I bought my "first" house in December last year. I own a share of a rental property that my parents bought when I was a child, of which my share is around £15k.Looking at SDLT rules, because I own a property abroad I do not qualify as a first time buyer.
Bad news: sadly, that is correct. You won't be eligible to the first time buyer stamp duty reduction or H2B/LISA bonuses.Using SDLT calculator on GOV.UK website I find that SDLT for the house I will buy will be 26000 GBP, but if I sell my flat abroad within 3 years I can get refund of 13500 GBP.
Good news: you don't need to sell the property. Since your flat is worth less than £40k, you will not have to pay the 3% higher stamp duty rate as per the HMRC link provided by davidmcn. However, my experience was that my solicitors were unaware of this caveat. They turned round a month (!) after our house purchase completed and said they couldn't register the purchase with the Land Registry until I paid the additional 3% SDLT. I provided them with the HMRC link, and they confirmed with the stamp duty HMRC advice line that I did not have to pay the extra 3%, though they left me to sweat for a week without replying to any emails until they found out! This was despite me telling about the BTL from the very beginning. I would therefore recommend that you get them to confirm early on in the process that you won't be required to pay the additional 3%.MFW2023 challenge #99: £1090.11 / £1,000 MFiT-T6 (Jan 2022 - Jan 2025) challenge #99: Reduce mortgage to £400,000. Current balance = £413,551.19 Initial MF date (23rd Aug 2022): Sep 2051 Current MF date: Jul 2051 Last updated: 15/06/20230
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