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Selling my share in a jointly owned home

Justi
Justi Posts: 27
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edited 26 November 2023 at 3:20PM in House buying, renting & selling
Hi everyone
My partner and I are separating and he is buying out my 50% share of our home, which we own as tenants in common. I believe that he will need to pay stamp duty when he buys my share and becomes the 100% owner - that seems clear and understandable. But someone has also said to me that when I buy a new home for myself I may be liable for the 3% second home stamp duty surcharge. I don't understand this as I will at that stage have already sold my primary home (my 50% share in our joint property). Can anyone enlighten me as to whether/why this surcharge would apply - it seems completely wrong! And I can't see anything on the government website that suggests I would be liable for the extra 3%. But maybe I am missing something. Thank you!

Comments

  • kingstreet
    kingstreet Posts: 38,616
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    It shouldn't. You are transferring equity for your only property and purchasing a new residence.
    I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.
  • Justi
    Justi Posts: 27
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    edited 26 November 2023 at 3:37PM
    Thank you. Does it matter that I also own a property that I rent out? And that I will be renting a place for a short period myself before buying a new home? I will be less than one year in rented accommodation.


  • chanz4
    chanz4 Posts: 10,852
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    Justi said:
    Thank you. Does it matter that I also own a property that I rent out? And that I will be renting a place for a short period myself before buying a new home? I will be less than one year in rented accommodation.


    if you own the rental, then buy another then yes you will be liable for 3%
    Don't put your trust into an Experian score - it is not a number any bank will ever use & it is generally a waste of money to purchase it. They are also selling you insurance you dont need.
  • Flugelhorn
    Flugelhorn Posts: 5,427
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    chanz4 said:
    Justi said:
    Thank you. Does it matter that I also own a property that I rent out? And that I will be renting a place for a short period myself before buying a new home? I will be less than one year in rented accommodation.


    if you own the rental, then buy another then yes you will be liable for 3%
    I thought that if you were replacing  a main residence by another main residence then you weren't liable for the 3% - in this case you start with 2 properties and end up with 2 properties
  • Justi
    Justi Posts: 27
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    chanz4 said:
    Justi said:
    Thank you. Does it matter that I also own a property that I rent out? And that I will be renting a place for a short period myself before buying a new home? I will be less than one year in rented accommodation.


    if you own the rental, then buy another then yes you will be liable for 3%
    I thought that if you were replacing  a main residence by another main residence then you weren't liable for the 3% - in this case you start with 2 properties and end up with 2 properties
    Yes, indeed. I will not be buying another rental. I will be renting a property while I look for a place to buy as my new main residence. I will go from owning a home and a rental, to temporarily living in rented accommodation and owning the rental, to eventually owning a new main home and the original rental.
  • SDLT_Geek
    SDLT_Geek Posts: 2,429
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    Justi said:
    Thank you. Does it matter that I also own a property that I rent out? And that I will be renting a place for a short period myself before buying a new home? I will be less than one year in rented accommodation.


    So long as you have been living in the jointly owned home as your only or main residence, and completely dispose of all of your interest in it, then I would expect you to benefit from the rules about replacing your only or main residence.  The conditions to meet are explained well in the guidance here: https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm09800
  • Justi
    Justi Posts: 27
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    SDLT_Geek said:
    Justi said:
    Thank you. Does it matter that I also own a property that I rent out? And that I will be renting a place for a short period myself before buying a new home? I will be less than one year in rented accommodation.


    So long as you have been living in the jointly owned home as your only or main residence, and completely dispose of all of your interest in it, then I would expect you to benefit from the rules about replacing your only or main residence.  The conditions to meet are explained well in the guidance here: https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm09800
    Thank you, SDLT Geek. That seems very clear. The link clarifies a lot. Thank you!
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