Complex 'Higher Rate' SDLT question

7sefton

Hi everyone,
I've tied myself up in knots trying to figure out if I'll need to pay higher stamp duty in the following situation - can anyone answer 100%?:
I own a flat that I have previously lived in as my main residence. Due to work, I'm moving away but can't sell the flat quickly, so have Consent to Let and tenants.
I am going to buy another flat near to my new place of work. This will be my main residence.
Do I need to pay the Higher SDLT even though I still only have one main residence?
Thanks.

davidmcn

Not sure what's complex about it. You already own one residential property. You're buying an additional one. Therefore yes, the additional rate applies to your purchase. Doesn't matter whether you occupy one, both or neither of them.

You might be able to later claim a refund if you sell the first property (if it qualifies as "replacing your main residence"), depending on the timescales involved. But you'll need to pay the higher rate in the first place.

AdrianC

Yes, absolutely you do.

You own A.
You are buying B and not selling A. +3%.

If you sell A within 3 yrs, you might be able to reclaim the +3%, if A was previously your home and B is now.

7sefton

OK thanks, but what about the following situation:
Home A - previous main residence, currently rented out.
I buy Home B, my new main residence. Pay the higher SDLT on this.
I then sell Home B to move back into Home A as my main residence (e.g. new job doesn't work out so I move back to where I used to live, obviously the tenants leave).
Would I get the Higher SDLT paid on Home B refunded?

davidmcn

7sefton said:
Would I get the Higher SDLT paid on Home B refunded?

That's also easy. No.

7sefton

Why not, when I have never had more than one 'main residence'?

7sefton

So I guess to minimize my SDLT bills, I need to ensure I sell the two properties in the 'right' sequence: i.e. must sell Home A before Home B, even if Home B doesn't turn out to be right.

davidmcn

7sefton said:

Why not, when I have never had more than one 'main residence'?

Most people only have one main residence at a time. That is kinda the point of main residences. It's got nothing to do with the primary liability for the higher rate SDLT though. The only relevance of main residences is the exemption described above where you're selling one shortly after buying a new one. It doesn't apply where you sell the new one and keep the old one.

7sefton

Thanks - I appreciate your patience with me
One last thing: does it matter if Home A has been rented out before it’s sold (within the 3 year limit), or as long as I sell it within the right timescale I’ll get the Higher SDLT refund on Home B?

SuperHan

So long as you sell within 3 years, it doesn't matter that it's rented out. 

SuperHan

SuperHan said:

So long as you sell within 3 years, it doesn't matter that it's rented out. 

Provided that you lived in the flat within 3 years of buying House B.