Stamp duty refund for accidental landlord

riggersssss

Hi everyone I was wondering if anyone can advise

In 2019 we put our apartment up for sale and accepted an offer, and thus went through the process of buying a house, a necessity due to starting a family.

Terribly, our sale fell through as our building had cladding which now needs to be remediated due to flammable insulation.

Due to this, we tried to sell for a 2nd and 3rd time, both of which fell through, thus leaving us with no choice but to remortgage to a BTL and rent the flat out to enable us to buy our family home.

Our stamp duty was 12k more than it would have been due to our house being a 2nd home.

Remediation will not be complete til 2026.

I understand that once remediation is complete, when I sell my flat I will get a refund of the £12k, but I wonder if there is any president to get this refunded now as the reasons for owning a second home were out of my control and brought on by this government?

Thank you in advance

Simon

MorningcoffeeIV

riggersssss said:

I wonder if there is any president to get this refunded now as the reasons for owning a second home were out of my control and brought on by this government?

There are lots of presidents, but no precedent for you to be refunded while you own two homes.

k12479

riggersssss said:

...we tried to sell for a 2nd and 3rd time, both of which fell through, thus leaving us with no choice but to remortgage to a BTL and rent the flat out....as the reasons for owning a second home were out of my control and brought on by this government?

Did you lower the price further, try a house buying company or stick it into auction?

pinkshoes

riggersssss said:

Hi everyone I was wondering if anyone can advise

In 2019 we put our apartment up for sale and accepted an offer, and thus went through the process of buying a house, a necessity due to starting a family.

Terribly, our sale fell through as our building had cladding which now needs to be remediated due to flammable insulation.

Due to this, we tried to sell for a 2nd and 3rd time, both of which fell through, thus leaving us with no choice but to remortgage to a BTL and rent the flat out to enable us to buy our family home.

Our stamp duty was 12k more than it would have been due to our house being a 2nd home.

Remediation will not be complete til 2026.

I understand that once remediation is complete, when I sell my flat I will get a refund of the £12k, but I wonder if there is any president to get this refunded now as the reasons for owning a second home were out of my control and brought on by this government?

Thank you in advance

Simon

There is no such thing as an accidental landlord. It was a choice you made, and part of that choice was accepting the additional £12k costs for now.

I thought you only had 36 months from purchasing a second home to reclaim the £12k once the first property is sold? If so, then if the remediation is not due until 2026, are you sure you're going to sell within this time period?

Did you try auctioning the property or lowering the price to sell to a cash buyer?

riggersssss

MorningcoffeeIV said:

riggersssss said:

I wonder if there is any president to get this refunded now as the reasons for owning a second home were out of my control and brought on by this government?

There are lots of presidents, but no precedent for you to be refunded while you own two homes.

Thanks. Worth an ask! At least I now know the difference between a president and a precedent

riggersssss

pinkshoes said:

riggersssss said:

Hi everyone I was wondering if anyone can advise

In 2019 we put our apartment up for sale and accepted an offer, and thus went through the process of buying a house, a necessity due to starting a family.

Terribly, our sale fell through as our building had cladding which now needs to be remediated due to flammable insulation.

Due to this, we tried to sell for a 2nd and 3rd time, both of which fell through, thus leaving us with no choice but to remortgage to a BTL and rent the flat out to enable us to buy our family home.

Our stamp duty was 12k more than it would have been due to our house being a 2nd home.

Remediation will not be complete til 2026.

I understand that once remediation is complete, when I sell my flat I will get a refund of the £12k, but I wonder if there is any president to get this refunded now as the reasons for owning a second home were out of my control and brought on by this government?

Thank you in advance

Simon

There is no such thing as an accidental landlord. It was a choice you made, and part of that choice was accepting the additional £12k costs for now.

I thought you only had 36 months from purchasing a second home to reclaim the £12k once the first property is sold? If so, then if the remediation is not due until 2026, are you sure you're going to sell within this time period?

Did you try auctioning the property or lowering the price to sell to a cash buyer?

Appreciate that - but when you start a young family which the flat is not big enough to house, it does somewhat tie one's hands.

I did indeed try lowering the price, but at the time, cash buyers were only offering exceptionally low prices, meaning I would have owed the bank more than what the sale price would have been.

And from what I understand from speaking to a financial advisor, the stamp duty rebate can be extended for extenuating circumstances, such as the government retrospectively changing planning laws leaving buildings unmortgagable....

Here's hoping!

riggersssss

Thought I'd loop back to this thread for anyone who is wondering what I was wondering (and is getting unhelpful comments!)

HMRC's website has a specific section and example which shows that anyone in the same circumstances as me will be granted an extension on the Stamp Duty refund, based on the ESW1 being unavailable at the initial time of attempted sale.

Example 5

Mr and Mrs F purchased a flat in a major city in early 2017. They have now had children and wish to upsize. They start to arrange the sale of their property but discover that it has external cladding and cannot obtain an EWS1 certificate until remediation work is completed on the building facade. Mr and Mrs F still wish to purchase a new home; they purchase a new main residence in January 2020 and pay the higher rates. Mr and Mrs F do not try to sell their old main residence as they are aware of the issues in trying to sell a property with cladding and that mortgage lenders would require both the remediation works to be completed and an EWS1 certificate obtained before lending against the flat. They decide they will try to sell once the remediation work is completed and they have an EWS1 certificate.

Due to backlogs and demand, the remediation works were only completed in April 2024 and it took a further 5 months to obtain an EWS1 certificate. Mr and Mrs F then immediately market the flat for sale and manage to sell it in October 2024. They write to HMRC and request a refund of the higher rates. They say the delay in selling their previous main residence was due to the exceptional circumstances of having to have remediation work done on the cladding and obtaining an EWS1 certificate. They also say they could not have reasonably foreseen that this was going to be an issue when they first purchased the previous main residence in 2017.

Mr and Mrs F are eligible for a refund of the higher rates. The delayed sale of Mr and Mrs F’s old main residence within the usual 3-year period is due to exceptional circumstances which could not reasonably have been foreseen and these circumstances prevented them from conventionally selling their property due to delays in arranging remediation works and obtaining an EWS1 survey.

Look here - HMRC Internal Manual - Stamp Duty Land Tax Manual - Condition D - Exceptional Circumstances.