BTL first property

jayu619

Hi there,
My brother is about to purchase his first home, which will be a BTL mortgage. The property in question is valued at £280k.

Will he have to pay stamp duty on this? Or am I right to think no stamp duty up to £300k as first time buyer?

Thanks
Jay

oldbikebloke

why not read the rules before asking? Not difficult to look up such simple facts 
first off the word "home" generally means a place "you" live in, not the place your tenant lives, as that would make it their home, not yours.
secondly, are you sure he is getting a BTL mortgage without already owning a property? It is possible, but limited market and therefore more expensive to do so. Does he intend to commit mortgage fraud by living in it as his "home", or does he intend to commit tax fraud by declaring an intent to occupy which cannot true when he is purchasing it as a BTL?

of course he will have to pay SDLT, but at the standard rate, not the higher rate since he will own only 1 property, but it is not his home and costs >£125,000
https://www.gov.uk/government/publications/stamp-duty-land-tax-relief-for-first-time-buyers-guidance-note

Chapter 1, 1st para, point 4
Broadly, this relief applies where:

 there is a purchase of a single dwelling,

 the purchase price is not more than £500,000,

 the purchaser or, if there is more than one, each of them, is an individual,

 the purchaser or, if there is more than one, each of them, is a first time buyer, who intends to occupy the dwelling as their only or main residence,

 the effective date of the transaction is on or after 22 November 2017, and

 the purchase is not linked to any other land transactions, except for –

o land that is or forms part of the gardens or grounds of the dwelling, or

o land that subsists for the benefit of either the dwelling or its garden and grounds.

jayu619

Thank you for the detailed reply 
My apologies - the "first home" should have read "first property". He is doing well in terms of salary and has a mortgage in principle offered for his first BTL.
So, no to living there himself. And all tax related issues declared as it's his income.
Wanted to double check whether he has to pay the SDTL on a first BTL property in which it won't be his main residence.
Thank you,
Jay

AdrianC

I'll never understand why people prioritise running a lettings business above their own home.

SDLT_Geek

No first time buyers’ relief available, so SDLT at standard rates.

csgohan4

You would hope the converyancer/solicitor would have pointed out the Stamp duty liabilities?

I hope your brother has researched fully what he is getting into with BTL and being a LL and both legal and tax implications

Mgman1965

Not forgetting that when he eventually buys his own home, he will have to pay the higher rate of SDLT as he will no longer be a FTB.