Change BTL property back to Residential property and Additional Stamp Duty refund possibilty

JonMitchell

Hi

A discussion came out and thought of asking the forum for some advice or anyone with past experience.

Scenario for discussion and advice:

a.) Purchase a BTL property in city A, complete and pay the additional stamp duty for second home say with a 2yr BTL mortgage. While still living in city B in own main resident home address.

b.) If within 3 years, due to change of work commitment, I have to sell main resident home in city B and move to city A. 

Query for advice/discussion:

. Sell my main residential property in city B and change the BTL property in city A to a residential mortgage upon 2yr completion.
. Would it be possible then to claim back the Additional Stamp Duty from HMRC as my main residency status has changed?

Am asking this not trying to evade tax or whatsoever, but enquiring if such scenario happened to anyone before?

Any thoughts/advice welcome.
 
  

SDLT_Geek

I am assuming this is in England, so the relevant tax is stamp duty land tax.

You will not qualify for a refund of the extra 3% SDLT paid on the let property in City A by virtue of selling your home in City B.  That is because on the date of the completion of your purchase in City A you did not intend to live in that property as your only or main residence.  The rules are explained here: https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm09800 

JonMitchell

SDLT_Geek said:

I am assuming this is in England, so the relevant tax is stamp duty land tax.

You will not qualify for a refund of the extra 3% SDLT paid on the let property in City A by virtue of selling your home in City B.  That is because on the date of the completion of your purchase in City A you did not intend to live in that property as your only or main residence.  The rules are explained here: https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm09800 

Yes, thanks it would be a property in England and it is the 3% extra that is of consideration.

Will have a read through the link you provided, thanks for that. Have been trying to find such information from HMRC website which ain't easy to find.