SDLT, first time buyers relief and married couples

allconnected

Finding conflicting advice online so posting here for opinions.

A married couple live in a property owned solely by spouse A. Spouse B has never owned any property.

They are selling up and moving house, and are looking at whether making the onward purchase solely in Spouse B’s name will mean they qualify for first time buyers relief for stamp duty purposes.  

A number of online guides by advisors say that having a spouse who has previously owned property excludes a buyer from first time buyers relief, even if they buy solely in their own name. However, I can’t find this exclusion anywhere in the actual SDLT rules,  or in the definition of a first time buyer - the definition only appears to consider the situation of the purchasers, not any non-buying  spouses.

Sooo.. are these articles all wrong - or if they are right, where in the first time buyer rules does having a spouse who has previously owned property exclude a purchaser from this relief?

(I know if the spouse still owns other property the higher rates will kick in and these do look at the property owning status of any spouse, but that isn’t the case here.)

opinions appreciated.

SDLT_Geek

allconnected said:

Finding conflicting advice online so posting here for opinions.

A married couple live in a property owned solely by spouse A. Spouse B has never owned any property.

They are selling up and moving house, and are looking at whether making the onward purchase solely in Spouse B’s name will mean they qualify for first time buyers relief for stamp duty purposes.  

A number of online guides by advisors say that having a spouse who has previously owned property excludes a buyer from first time buyers relief, even if they buy solely in their own name. However, I can’t find this exclusion anywhere in the actual SDLT rules,  or in the definition of a first time buyer - the definition only appears to consider the situation of the purchasers, not any non-buying  spouses.

Sooo.. are these articles all wrong - or if they are right, where in the first time buyer rules does having a spouse who has previously owned property exclude a purchaser from this relief?

(I know if the spouse still owns other property the higher rates will kick in and these do look at the property owning status of any spouse, but that isn’t the case here.)

opinions appreciated.

What matters for SDLT is not whose "name" a property is in, but who owns the underlying beneficial interest.  In your scenario if Spouse B is to own the property alone and meets the other conditions (intending to live in the property and the price not being over £625,000) then first time buyers' relief can properly be claimed.

As you say, it is important to check the property owning position of the other spouse to check that the 3% surcharge override does not kick in.

There are rules for the 3% surcharge which make a spouse's property owning position relevant, but these are not replicated in the first time buyer relief rules (other than to the extent of the possible 3% surcharge override).

The point is confirmed in the guide here: https://www.blakemorgan.co.uk/wp-content/uploads/Downloads/Stamp-Duty-Land-Tax-First-Time-Buyers-Relief-29052019.pdf see section 6.1.

allconnected

Thank you - I’m surprised by how many guides to first time buyers relief make a blanket statement that spouses must both be first time buyers even if only one is purchasing, when this condition doesn’t appear anywhere in the rules.