SDLT holiday eligible? - sold last main residence 2 years ago but have overseas investment property

[Deleted User]

Hi all, 

I'm sorry for hijacking the other thread and causing confusion.

I sold my previous main residence two years ago but own an overseas investment property which has never been my residence. I suppose my question is - does the additional property rule trump the fact that I sold my previous residence two years ago meaning I would not get the SDLT break or does the fact that I sold my previous residence within three years trump the additional property rule?

Thanks in advance!

SDLT_Geek

The fact that you sold a previous home within the last three years could trump the fact that you own another property.  There are five conditions to meet which you will find in HMRC's guidance here https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm09800  The main ones to watch out for are:

(a)  You last lived in the previous property as your only or main residence at some point in the three years leading up the completion of the purchase of your new home.
(b)  You intend to live in the property you are buying as your only or main home.

The position could be complicated if you are buying jointly with someone else, or if you have a spouse / civil partner with property interests.

[Deleted User]

SDLT_Geek said:

The fact that you sold a previous home within the last three years could trump the fact that you own another property.  There are five conditions to meet which you will find in HMRC's guidance here https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm09800  The main ones to watch out for are:

(a)  You last lived in the previous property as your only or main residence at some point in the three years leading up the completion of the purchase of your new home.
(b)  You intend to live in the property you are buying as your only or main home.

The position could be complicated if you are buying jointly with someone else, or if you have a spouse / civil partner with property interests.

Thanks for sharing. I do intend to live in the new property as my new main residence. 

In relation to point 4 "The purchaser must have lived in the old property as the purchaser’s only or main residence at some point in the three-year period preceding the date of the purchase of the new property  [Para 3(6) (c)]. This is the three-year occupation rule.",

Does the "three year occupation rule" mean I must have lived in the old property for three consecutive years or simply lived in it as my main residence at some point within the last three years? Thanks again

SDLT_Geek

Saint4805 said:

In relation to point 4 "The purchaser must have lived in the old property as the purchaser’s only or main residence at some point in the three-year period preceding the date of the purchase of the new property  [Para 3(6) (c)]. This is the three-year occupation rule.",

Does the "three year occupation rule" mean I must have lived in the old property for three consecutive years or simply lived in it as my main residence at some point within the last three years? Thanks again

At some point in the last three years.  So for example, if you lived in it for 5 years, having moved out in June 2018, then you would need to complete your upcoming purchase by June 2021 so as to be within three years of last having lived in the old property as your only or main residence.

[Deleted User]

SDLT_Geek said:

Saint4805 said:

In relation to point 4 "The purchaser must have lived in the old property as the purchaser’s only or main residence at some point in the three-year period preceding the date of the purchase of the new property  [Para 3(6) (c)]. This is the three-year occupation rule.",

Does the "three year occupation rule" mean I must have lived in the old property for three consecutive years or simply lived in it as my main residence at some point within the last three years? Thanks again

At some point in the last three years.  So for example, if you lived in it for 5 years, having moved out in June 2018, then you would need to complete your upcoming purchase by June 2021 so as to be within three years of last having lived in the old property as your only or main residence.

I sold it in March 2019 and lived in it for several months leading up to the sale and so it sounds like I am also meeting that criteria. Thanks again. 

SDLT_Geek

To live in a property for several months might not meet the bill.  For the occupation to be as a main or only residence, it needs to be with “a sufficient degree of permanence and expectation of continuity”.

[Deleted User]

SDLT_Geek said:

To live in a property for several months might not meet the bill.  For the occupation to be as a main or only residence, it needs to be with “a sufficient degree of permanence and expectation of continuity”.

It was actually my main residence for over three years leading up to the sale. I just happened to rent it out twice on two short term lets in the final year leading up to the sale in March 2019. The final short term let ended in late 2018 and I lived in it again from then until it was sold in March 2019. 

SDLT_Geek

Saint4805 said:

SDLT_Geek said:

To live in a property for several months might not meet the bill.  For the occupation to be as a main or only residence, it needs to be with “a sufficient degree of permanence and expectation of continuity”.

It was actually my main residence for over three years leading up to the sale. I just happened to rent it out twice on two short term lets in the final year leading up to the sale in March 2019. The final short term let ended in late 2018 and I lived in it again from then until it was sold in March 2019. 

You will need to look at the arrangements here in some detail to see if the 3% surcharge is due.  The property was clearly not your residence when it was let out.