Stamp duty claim back?

Pumpkin0217

Hello 
I am currently going through a divorce where me and my soon to be ex husband have decided to be amicable and do a cheap  divorce through a online solicitor so that means we decide how to split finances ourselves without going to court. He is buying me out and I have made an offer on a house which has been accepted and I am just waiting on the transfer of equity and then I can arrange my moving in date. The issue is I thought I would just pay 3% stamp duty tax as I am getting divorced and being taken off the mortgage of my current house but it looks like I will have to pay the higher rate of stamp duty (Buying a second home tax even though I am not buying a second home) which I really can’t afford it’s +£7000! Because me and my soon to be ex did not do a consent order sealed by a judge. Is there any other way I could prove I am getting divorced and will not own my current home as I really don’t want to pay extra money when technically I’m not buying a second home. I don’t think I will be divorced before I buy my new home as covid has slowed everything down of course but I cannot wait 8 weeks for a contest order as the seller has just had twins and wants to move out ASAP they have no chain and have already waited enough as this whole remortgage has taken far longer than it should so I feel bad making them wait any longer and plus I really need to get away from my ex we’ve had a toxic abusive relationship and it’s been very hard living with him during the lockdown. If there’s no way I can prove I am getting divorced currently and I will not own a second home can I reclaim the stamp duty after my divorce papers come in? I really can’t afford to lose £7000
thank you

AdrianC

I presume the part-sale and the purchase are chained, with the money from the sale going on the purchase - so when the new place is registered in your name, the old one will no longer be...

Perfectly normal chain transaction. No +3%.

Pumpkin0217

AdrianC said:

I presume the part-sale and the purchase are chained, with the money from the sale going on the purchase - so when the new place is registered in your name, the old one will no longer be...

Perfectly normal chain transaction. No +3%.

My conveyancing solicitor said That hmrc need to see a consent order to actually prove that I am getting a divorce and coming off the deed. Of course I will get proof that I have come off the deed but that could be after I move into my new home! So I will have to pay higher rate stamp duty as I would technically own two homes at that time. So can I claim that stamp duty back when I get the proof? 

AdrianC

Yes, definitely. Because you're selling your previous primary residence within three years.

But you really shouldn't have to. If necessary, delay the SDLT return as long as possible...

blue_max_3

If you buy a second home, you have to pay the +3%. But if you sell your existing home within three years, you can reclaim it back.
I'm surprised you have managed to find another property, had an offer accepted and are wanting to exchange in less time it has taken for your ex to buy you out. Surely a much simpler operation.
However, when you say "I really need to get away from my ex we’ve had a toxic abusive relationship and it’s been very hard living with him during the lockdown", I wonder if he's dragging his heels intentionally? Will you be ok if he decides to just live there and not move out or pay you?
And are you really in a position to buy without his contribution? 

Pumpkin0217

blue_max_3 said:

If you buy a second home, you have to pay the +3%. But if you sell your existing home within three years, you can reclaim it back.
I'm surprised you have managed to find another property, had an offer accepted and are wanting to exchange in less time it has taken for your ex to buy you out. Surely a much simpler operation.
However, when you say "I really need to get away from my ex we’ve had a toxic abusive relationship and it’s been very hard living with him during the lockdown", I wonder if he's dragging his heels intentionally? Will you be ok if he decides to just live there and not move out or pay you?
And are you really in a position to buy without his contribution? 

This whole remortgage process has been a nightmare! It started in February and still not done his solicitors are being very slow! But it is in the final steps now so hopefully the transfer will happen in the next few weeks! He is staying in the current home hence the remortgage it was the quickest way I could leave because if we decided to sell the house it would probably still be on the market. So is me getting the equity transfer from the remortgage and being taken off the mortgage and deed count as selling my property? I don’t understand why my conveyancing solicitor is so adamant that I have to pay the higher rate tax because I don’t have a consent order from my divorce.

AdrianC

Pumpkin0217 said:
So is me getting the equity transfer from the remortgage and being taken off the mortgage and deed count as selling my property?

Yes, absolutely.

I don’t understand why my conveyancing solicitor is so adamant that I have to pay the higher rate tax because I don’t have a consent order from my divorce.

*slaps forehead* Of course. Sorry.

 HMRC count a married couple as a single unit for SDLT purposes. He's thinking that they'll see your purchase as an additional property because the married-plural-you is not selling the previous main residence. But the divorce paperwork will allow HMRC to separate the two of you.

Pumpkin0217

AdrianC said:

Yes, definitely. Because you're selling your previous primary residence within three years.

But you really shouldn't have to. If necessary, delay the SDLT return as long as possible...

Thank you! Silly question how can I delay the SDLT return ? 

AdrianC

Pumpkin0217 said:

AdrianC said:

Yes, definitely. Because you're selling your previous primary residence within three years.

But you really shouldn't have to. If necessary, delay the SDLT return as long as possible...

Thank you! Silly question how can I delay the SDLT return ? 

Simple. Don't send it. The deadline is 14 days from the transaction.

grahamh111

I own a property with my x-spouse who I am divorcing, in which case the property will sold or she will buy me out. I am buying a new property with my new partner which seems, for tax reasons, to be classed as a second home. Is this correct? Does this mean that we have to pay stamp duty at the higher rate? If so can I claim it back once my name is off the deeds?

macman

Yes, you do. You can claim back the extra 3% as long as the 1st property is sold within 3 years of the 2nd purchase, and as long as you are by then divorced, if your ex does buy out your share. You can't claim if your spouse owns any part of the home.