Do I have to pay Stamp Duty?

normal

I'm querying the advice we've received from our conveyancer, especially as they don't seem too sure themselves.
My wife and I each own a rental property but do not own the home in which we live (currently renting). We're now about to complete the purchase of the house (£305,000). This will be our primary residence and the conveyancer has suddenly said we have to pay £9,100 stamp duty. Is this right if we are buying our primary residence?
Many thanks 

davidmcn

Yes, you're increasing the number of residential properties you own, so the additional rate of SDLT applies. Doesn't matter what you're going to use it for.

oldbikebloke

as above "you" currently own 1 property each. Neither of those is a property you live in

after this purchase "you" will own a third property so an additional property subject to additional rate SDLT because you have NOT SOLD (ie replaced) a property you were previously living in so as to buy the new one.

Where you live at the moment is rented, so you can't sell it, therefore you cannot claim exemption from the higher rate for having replaced your current home as you have not, in that sense, done so.

conveyancer correct 
if purchase is before March 2021 then the higher rate applicable during the "standard" rate "holiday" will be:
3% between £1 - £500,000 price paid 
so @ £305,000 price paid means that would be £9,150 SDLT payable

normal

So it doesn't matter that we don't live in either property we currently own? This phrase from the MSE guide is slightly misleading then: "In England and Northern Ireland, there is now no stamp duty on any primary residential property worth up to £500,000."

es5595

Nope, it has no affect. 

If/when you come to sell this new property (and assuming you’re still living in it as a primary residence), you’ll only pay the standard stamp duty on the new house you buy as your primary residence, regardless of whether you still have both rental properties. 

Tiglet2

normal said:

So it doesn't matter that we don't live in either property we currently own? This phrase from the MSE guide is slightly misleading then: "In England and Northern Ireland, there is now no stamp duty on any primary residential property worth up to £500,000."

Also from the MSE Guide:  The 3% levy paid if you already own a home and are buying an additional property worth more than £40,000 still applies (though you'll still pay less than you would due to the raised threshold). 

davidmcn

normal said:

So it doesn't matter that we don't live in either property we currently own? This phrase from the MSE guide is slightly misleading then: "In England and Northern Ireland, there is now no stamp duty on any primary residential property worth up to £500,000."

Correct - otherwise the obvious loophole would be to initially move into every additional property when you buy it, while you increase the size of your portfolio.

normal

Well. That's all gone an blown a giant hole in our budget. We were advised that we'd have to pay approx £5,000 stamp duty prior to the recent changes. That advice was obviously wrong. We're not sure now if we can complete the purchase.

macman

Who gave you this advice?

normal

The macman said:

Who gave you this advice?

The conveyancer. Even yesterday, when they were asking us to fill in the stamp duty form, they told us we didn't have to pay anything. It was only today we got told it was £9150! 

davidmcn

normal said:

The macman said:

Who gave you this advice?

The conveyancer. Even yesterday, when they were asking us to fill in the stamp duty form, they told us we didn't have to pay anything. It was only today we got told it was £9150! 

Did they already know about your existing properties?