Stamp duty, second home refund

ChilliBob

Hey guys, 
Were looking to move, due to a change in circumstances we actually could be cash buyers for a new property. This obviously puts us in a great position, but we do want to sell the properties we live in and own.

I didn't think it was possible to buy then sell without paying 'second home stamp duty' but my partner has found something about a refund of this second home level if you sell your previous properties within a given time frame. 

As the sums involved are pretty large I wanted to see if anyone had experience of going down this route and could offer any advice. 

As a note, obviously we would prefer to sell the properties now, then buy, as this saves extra council tax, insurance, risks associated with empty properties and having to claim for a refund of second home stmwp duty, however, neither of our houses seem to be shifting that fast

Any help much appreciated. 

SDLT_Geek

Key to answering this will be to know which of the properties is where you live as your main residence, or has been within the last three years.  Then whether a property answering that description will be sold before your purchase, or if it will be sold after your purchase completing.

ChilliBob

Basically living in our house now, which we have lived in permanently for 5 years. I own this. My partner owns a flat she lived in for years but has converted to buy to let for the last 5 years.
Our original plan was to sell both to buy a property together and top up with a smallish mortgage. Our situation has changed thou. 
Essentially, I want to know if we buy a new place with cash now, then sell our other two properties within a few months if (minus coucil tax and insurance) the cost is roughly the same in the end. 

SDLT_Geek

Are you and your partner married or civil partners?  If so then the sale of your property alone (where you have both been living) will work:

if completed before your purchase to save you from paying the extra 3%

or

if you sell it afterwards within three years, to entitle you to recover the 3%.

ChilliBob

We are not married (yet, delayed due to Covid, scheduled for April '21).
Seems house wise we are covered either way.

Regarding my partners flat, which she hasnt lived in for over  5 yesrs.. I'm wondering if makes sense to purchase without her, then she sells then we put her on the property too. 

ChilliBob

Disregarding my partners flat, and imagining it's just my house, which we live in, and a new house, which I will buy on my own, would it be correct to say:

*Sale of old house *after* purchase of new house, but within 3 years means:
* Refund on 'second home stamp duty' on new house.
* Capital gains tax not applicable, as in effect this is still 'selling main residence'

Cheers 

Doozergirl

ChilliBob said:

Disregarding my partners flat, and imagining it's just my house, which we live in, and a new house, which I will buy on my own, would it be correct to say:

*Sale of old house *after* purchase of new house, but within 3 years means:
* Refund on 'second home stamp duty' on new house.
* Capital gains tax not applicable, as in effect this is still 'selling main residence'

Cheers 

Yes

ChilliBob

Nice, cheers, that's what I thought, but since it makes the difference of sbout 50k I want to be sure! 

Flugelhorn

I claimed this back recently - filled in a form I downloaded, needed a UTRN for the form which my solicitor gave me, posted the form and the money was in my account within 2-3 weeks

ChilliBob

Oh that's great, thanks for the info. What's a UTRN, please excuse my ignorance! As I understand it this is something you need to claim very soon after the sale of the old property, so I guess its entirely separate from any yearly tax return or anything? 

Flugelhorn

ChilliBob said:

Oh that's great, thanks for the info. What's a UTRN, please excuse my ignorance! As I understand it this is something you need to claim very soon after the sale of the old property, so I guess its entirely separate from any yearly tax return or anything? 

It was the unique transaction reference number, solicitor got it when paying the extra  stamp duty when we bought the second house. It was completely separate from personal tax returns, basically needed the UTRN, who you had sold old house to and how much money you were claiming back. They even paid interest I think (well there was a random £20.68 paid to me)