Stamp Duty

aheldth

Hello everyone 

I would appreciate some clarity on the level of stamp duty I would have to pay as I’ve received some conflicting information.

I am currently living with parents following a break up with my partner a couple of years ago and have been saving for a deposit since. The flat where my ex partner lives however was purchased as a joint application and as a result of her income she is unable to solely transfer the property into her name. 

My concern is that I will eventually have two mortgages in my name and therefore be eligible to cover the higher additional home stamp duty. I believe this tax was essentially introduced for buy to let investments however and so perhaps hope that I could be considered under the moving home or first home tax instead. 

Any advice to clarify would be appreciated as it has a significant bearing on the amount I would need to save.

Thank you in advance 

Alex 

propertyrental

Why oh why do people not sort out/separate their finances when they split? In addition to the problem you pose, you are linked financially to your ex. 

Your ex goes into debt, runs up arrears on the mortgage, applies for too many credit cards etc etc and it will affect your credit rating too.

Yes, you own (jointly) a property. If you buy an additional property, you'll attract additional SDLT (in England)

If she cannot afford to buy you out, you need to persuade/force her to sell.

SDLT_Geek

aheldth said:

Hello everyone 

I would appreciate some clarity on the level of stamp duty I would have to pay as I’ve received some conflicting information.

I am currently living with parents following a break up with my partner a couple of years ago and have been saving for a deposit since. The flat where my ex partner lives however was purchased as a joint application and as a result of her income she is unable to solely transfer the property into her name. 

My concern is that I will eventually have two mortgages in my name and therefore be eligible to cover the higher additional home stamp duty. I believe this tax was essentially introduced for buy to let investments however and so perhaps hope that I could be considered under the moving home or first home tax instead. 

Any advice to clarify would be appreciated as it has a significant bearing on the amount I would need to save.

Thank you in advance 

Alex 

Are you buying in England, so the stamp duty at issue would be stamp duty land tax?

If so, I would expect the extra SDLT (presently 3%, but it might increase in the 15 March budget) to be due.  There could be wriggle room though:

• If your share in the flat is worth under £40,000 (before taking off anything for the mortgage)
• If you were married or civil partners and there is a "property adjustment order" in place in favour of your ex partner.

EssexHebridean

This might be of interest: https://www.tax.service.gov.uk/calculate-stamp-duty-land-tax/#/intro

_Penny_Dreadful

aheldth said:

Hello everyone 

I would appreciate some clarity on the level of stamp duty I would have to pay as I’ve received some conflicting information.

I am currently living with parents following a break up with my partner a couple of years ago and have been saving for a deposit since. The flat where my ex partner lives however was purchased as a joint application and as a result of her income she is unable to solely transfer the property into her name. 

My concern is that I will eventually have two mortgages in my name and therefore be eligible to cover the higher additional home stamp duty. I believe this tax was essentially introduced for buy to let investments however and so perhaps hope that I could be considered under the moving home or first home tax instead. 

Any advice to clarify would be appreciated as it has a significant bearing on the amount I would need to save.

Thank you in advance 

Alex 

It wasn’t a tax introduced specifically for BTL but anyone who owns more than one residential property, which you will. Nothing to do with mortgages either but the fact you’ll have beneficial interest (assuming your interest in the jointly owned home is £40k+) in two separate residential dwellings unless there’s something like a Mesher Order or Martin Order in place following a divorce or dissolution of a civil partnership. 

I do agree with @propertyrental, the relationship ended years ago so the jointly owned property should have been dealt with years ago. Your ex can’t afford to buy you out so your ex needs to face facts that they can’t afford to continue living there. Could you afford to buy your ex out? Is your ex amenable to selling or would you need to force the sale through the courts? 

aheldth

Hi thanks for the responses.

I’d like to approach the situation neutrally as I’ve laid out if possible. In short my ex partner has health issues such that I have gladly agreed to continue funding the mortgage on the property where she resides. 

The property is in England. I would like just like some clarification on my position, for good or for bad.

many thanks

alex 

aheldth

Just to confirm we were not married and the property values are below £40k.

thank you 

_Penny_Dreadful

aheldth said:

Just to confirm we were not married and the property values are below £40k.

thank you 

The property you jointly own with your ex is worth less than £40,000? It’s not a shared ownership property or something is it? If it’s worth less than £40,000 then your share of the property is worth less than £40,000 meaning the higher rate of SDLT will not apply on your next purchase as condition C will not be met. 

https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm09780

aheldth

My mistake that last post should have read NOT below £40k! 

But I suppose that unless there are any other observations, that appears to answer the question so thank you.