Complicated House Buying Scenario!

K_S

Windofchange said:

K_S said:

Windofchange said:

Probably something to take professional advice on then? As I say, when we went through this last year the advice from our solicitor was very black and white - if you have a home already that you are occupying then that is your main residence whether you are renting there temporarily or are an owner occupier. Depending on which bit of the country the OP is looking at, it may / may not make much difference, but assuming an average house price of 256k ish then it will be a nasty sting if it does apply, and may then influence quite heavily the decision about what to do with the rental property in my view. 

@windofchange Tbf conveyancers aren't always SDLT experts. The advice you were given re the part about renting in between is most definitely questionable as I have seen at least 2 cases of clients (who also own rental/second properties) who moved into private rentals between house purchases to be chain free and didn't pay the 3% surchage on their onward purchase.

Edit: Same scenario as OP's from the gov.uk SDLT pages https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm09810

I think the distinction made at the time was we had never owned a property as a main residence, therefore couldn't include it as such. We hadn't sold something, rented something in the meantime and then brought again. 

@windofchange That's right, the 'main residence' SDLT exemption only comes into play if you owned a property as a main residence that you sold, either before the new main residence purchase or within 3 years (to be eligible to apply for a refund of the 3% surcharge). So I don't see it being applicable in your case.

Windofchange

K_S said:

Windofchange said:

K_S said:

Windofchange said:

Probably something to take professional advice on then? As I say, when we went through this last year the advice from our solicitor was very black and white - if you have a home already that you are occupying then that is your main residence whether you are renting there temporarily or are an owner occupier. Depending on which bit of the country the OP is looking at, it may / may not make much difference, but assuming an average house price of 256k ish then it will be a nasty sting if it does apply, and may then influence quite heavily the decision about what to do with the rental property in my view. 

@windofchange Tbf conveyancers aren't always SDLT experts. The advice you were given re the part about renting in between is most definitely questionable as I have seen at least 2 cases of clients (who also own rental/second properties) who moved into private rentals between house purchases to be chain free and didn't pay the 3% surchage on their onward purchase.

Edit: Same scenario as OP's from the gov.uk SDLT pages https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm09810

I think the distinction made at the time was we had never owned a property as a main residence, therefore couldn't include it as such. We hadn't sold something, rented something in the meantime and then brought again. 

@windofchange That's right, the 'main residence' SDLT exemption only comes into play if you owned a property as a main residence that you sold, either before the new main residence purchase or within 3 years (to be eligible to apply for a refund of the 3% surcharge). So I don't see it being applicable in your case.

Yup - I've just dug up the article that I read that explains it all. If I had owned the home we were in then we would have avoided the 3%. The fact that we rented it means that we were not 'disposing' of a main residence, and therefore I can't claim anything back. Article below for any others who find themselves in a similar position. 

https://www.ft.com/content/bb51e06e-2bd1-11e6-bf8d-26294ad519fc

For us it worked out in the end as the stamp duty holiday meant that we ended up paying about the same amount of SDLT as we would have done had we not owned another property, so we were lucky - we just paid the 3% additional rate rather than the basic rate and then the 3%.