SDLT additional 3%?

Swash

Hi everyone,

I know this has been asked numerous times but I can't get my head around the SDLT for additional properties.

My partner bought his flat before we were together and it was his main residence. I bought my house before we were together and lived in it as my main residence. We were both in the forces at this point so also lived on camp through the working week (not sure if that makes any difference). 3 years ago, he moved into my house and rented his out on a BTL mortgage. He has paid half towards all the bills including the mortgage, I have paid half towards his bills and mortgage too.

We are now buying our next house together. I am selling my house (our main residence) and using the equity towards our new house. He is keeping his BTL.

I am told that we have to pay the additional SDLT on the whole purchase price, because he is not selling his BTL. Even though his name isn't on my deeds, it has been his main residence for over 3 years, and I find it a little unfair that the main residence rule doesn't apply because his name isn't on the deeds, and it is due on 100% of the purchase price of the new house, even though he will technically only own 30% (tenants in common).  Is this correct? 

In hindsight we should have thought ahead and put him on the deeds of my house, then the SDLT bill would be much less! 

Thanks in advance,

Swash.

SDLT_Geek

If you are married or civil partners by the time of your sale, the extra 3% SDLT should not apply to the joint purchase.  That assumes you have both lived in your property as your only or main residence.  Also that the new property is to be your partner’s only or main residence.

Swash

SDLT_Geek said:

If you are married or civil partners by the time of your sale, the extra 3% SDLT should not apply to the joint purchase.  That assumes you have both lived in your property as your only or main residence.  Also that the new property is to be your partner’s only or main residence.

Thanks SDLT_Geek. We are not married and are hoping to complete in January so it isn't an option unfortunately. So based on our situation, is my understanding correct that the 3% is due, even though it's our main residence and I am selling it to buy our next main residence?

AdrianC

You now own one property - your primary residence. A
He now owns one property - not his primary residence. B
A is being sold, B is not.
You are jointly buying C as your joint primary residence.

You are going from one property to one property. A to C
He is going from one property to two properties. B to B+C.
+3% SDLT due on entire purchase price.

There are two ways to avoid it.
1. He sells his other property, so he doesn't go from one to two.
2. You buy this one alone.

Yes, you can get married before the end of January - 29 days minimum notice.
https://www.gov.uk/marriages-civil-partnerships/give-notice

Swash

AdrianC said:

You now own one property - your primary residence. A
He now owns one property - not his primary residence. B
A is being sold, B is not.
You are jointly buying C as your joint primary residence.

You are going from one property to one property. A to C
He is going from one property to two properties. B to B+C.
+3% SDLT due on entire purchase price.

There are two ways to avoid it.
1. He sells his other property, so he doesn't go from one to two.
2. You buy this one alone.

Yes, you can get married before the end of January - 29 days minimum notice.
https://www.gov.uk/marriages-civil-partnerships/give-notice

Thank you AdrianC. That is what I thought, it's very frustrating but I guess we have to count ourselves lucky that we will still have 2 properties between us. 

Unfortunately I don't meet the affordability criteria alone, we already tried that as an option. We are also hoping for a mid January completion. I guess we will have to suck it up and hope it all goes through in a couple of weeks. If not we'll be on our way to Gretna Geen

Thanks for your help,

Swash.

SDLT_Geek

I agree with @AdrianC

Swash

Thanks all!

martindow

Are you not considering a quick registry office marriage as has been suggested?  For the cost of the licence you can save paying the extra 3%.  In time to come you can organise a dreamy, romantic ceremony somewhere for all of your guests.  These are not mutually exclusive options.