SDLT Extension of the three year time limit within which to sell a previous home.

jasperc_2

SDLT_Geek said:

...There is a similar problem for a person who (if they are to escape the 3% surcharge) needs to complete the purchase of a new home within three years of the sale of an old home (because they own another property).
  
Representations have been made to Government to allow an exceptional circumstances extension in this situation as well.  I heard today that this idea had been considered by Government, but was rejected.  So it seems likely that the exceptional circumstances extension will only apply to cases where the old home cannot be sold within the three years following the purchase of the new home.

Hi and thank you SDLT_Geek. We are caught under exactly these circumstances - unable to complete purchase within 3 years. We had a purchase lined up that would have been within the 3 year limit but it fell through during the early 2020 lockdown and we are now outside the time limit. Any more information you could provide whether there is a way around this would be much appreciated. It's hard to see why extensions are allowed for delayed sales but not purchases.   

SDLT_Geek

jasperc_2 said:

SDLT_Geek said:

...There is a similar problem for a person who (if they are to escape the 3% surcharge) needs to complete the purchase of a new home within three years of the sale of an old home (because they own another property).
  
Representations have been made to Government to allow an exceptional circumstances extension in this situation as well.  I heard today that this idea had been considered by Government, but was rejected.  So it seems likely that the exceptional circumstances extension will only apply to cases where the old home cannot be sold within the three years following the purchase of the new home.

Hi and thank you SDLT_Geek. We are caught under exactly these circumstances - unable to complete purchase within 3 years. We had a purchase lined up that would have been within the 3 year limit but it fell through during the early 2020 lockdown and we are now outside the time limit. Any more information you could provide whether there is a way around this would be much appreciated. It's hard to see why extensions are allowed for delayed sales but not purchases.   

Unfortunately the three year time limit is strict for cases where the purchase of the new home is after the sale of the old home.  There is no provision for extension for exceptional circumstances.

The 3% extra would be due presumably because of another property owned.  Could that other property first be disposed of?  Perhaps to a limited company?

jasperc_2

Yes, I bought a BTL flat in 2018 as an interim measure after selling my main residence - pending finding a house I actually wanted to live in. I've been renting since, using the BTL income to cover my rent.

I've reviewed whether to sell the flat into a limited company. The costs (even with the SDLT reduction) are likely to be between £10 and £12k. Mostly mortgage redemption penalty costs and the SDLT itself. Minor cap gains. 

I'm not trying to avoid paying higher rate SDLT for a second property - it just seems we are paying it on the wrong house - our main residence! It seems rather unfair and I have no idea what the logic could be for excluding delayed purchases from the Covid extension. 

Thanks for your help