Stamp Duty Reimbursement Buy to Let

Tron103

Hi all, 
We have struggled to sell our flat so are looking at renting in the short term and trying to sell again with 36 months. 
Does anyone know if we bought a house before March 31st 2020, would we get a full rebate on stamp duty if we were to sell the flat within 36 months given the current stamp duty holiday? Or would any rebate be based on standard stamp duty charges? 
Hope this makes sense.
Thanks!

Comms69

Do you really want to be landlords? 99/100 the price is too high if you're struggling to sell

oldbikebloke

do you really mean March 2021? I assume 2020 is a typo otherwise your question makes no sense

the principle for higher rate refunds has not changed.
If you buy a "new" main residence before selling the old one the higher rate will apply. So under the "holiday" (ie reduced rate period) the rate applicable in that case is std rate (0% if <£500k) + 3% (on each std tier)
https://www.gov.uk/guidance/stamp-duty-land-tax-temporary-reduced-rates#higher-rates-for-additional-properties

if you buy before you sell, that sale still has to take place within 3 years of the purchase to qualify for a refund. Covid has not altered that, the refund would be the amount you actually paid.
 https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm09800


(PS your comment "we are looking at renting" is confusing. Do you mean you are looking to let the existing property (ie "rent out") or do you mean you are looking to move out of the one property you own and live in rental accommodation until you complete the purchase of the new place?. If the latter, such a "rental" is ignored as long as you still meet the 3 year time limit for the sale of the owned (ex main)  property)

allygate

Tron103 said:

Hi all, 
We have struggled to sell our flat so are looking at renting in the short term and trying to sell again with 36 months. 
Does anyone know if we bought a house before March 31st 2020, would we get a full rebate on stamp duty if we were to sell the flat within 36 months given the current stamp duty holiday? Or would any rebate be based on standard stamp duty charges? 
Hope this makes sense.
Thanks!

@tron103
So if you buy a house now (completing on or before 31 March 2021) that is <500k, all you will pay as SDLT is 3% of the purchase price (the surcharge).

If you then go on to sell the flat within 36 months of when you completed on the house, you can apply for a refund of that 3% that you paid.

If you bought a house >500k (completing on or before 31 March 2021), you would pay the standard sdlt plus the 3% surcharge. Later when you sell the flat within the above time period, you only get a refund of the 3% surcharge paid, not the standard sdlt.

I hope that makes sense.

Tron103

Thanks you! Super helpful, despite my badly formed original post! 
On the price point, we already reduced by £20,000 and we haven't had a single viewing in four months. It's now priced the same as what we bought it for 4.5 years ago (£280,000). The same flat next door sold for £295,000 in Jan 2020.  Our EA has advised that they've only been able to sell one flat in this price bracket over the last four months so it looks like the demand for buying flats is simply not there in our area at the moment - Covid has not been friendly to flat sellers. We want to move so becoming landlords is unfortunately our only option in the short-term. 

AnotherJoe

Tron103 said:

Thanks you! Super helpful, despite my badly formed original post! 
On the price point, we already reduced by £20,000 and we haven't had a single viewing in four months. It's now priced the same as what we bought it for 4.5 years ago (£280,000). The same flat next door sold for £295,000 in Jan 2020.  Our EA has advised that they've only been able to sell one flat in this price bracket over the last four months so it looks like the demand for buying flats is simply not there in our area at the moment - Covid has not been friendly to flat sellers. We want to move so becoming landlords is unfortunately our only option in the short-term. 

Or reduce the price to a realistic one? Are you planning to hold on to this  indefinitely? What if flat prices fall further?

steampowered

If you retain this property, you will be exposed to any price increases or decreases of that type of property.

If you sell and move to a different property, you will be exposed to any price increases or decreases of that type of property.

Is there any reason to think that the price of your current property will do better over the next 3 years than the property you are moving to? Are you moving from a flat to a house with a garden for example?

If your current property increases in value by £20k over the next 3 years, but the property you eventually buy increases in value by £30k, you are actually £10k down.