Claim back stamp duty 2nd home

doby1515

Hi 

I recently purchased a new property (Home B ) before selling my existing one (Home A) and paid additional stamp duty (2nd home).  

Home A is currently up for sale and I read that if I sell this within 3 years I will be able to claim some stamp duty back. 

I intend to start living in Home B now but am worried that this will prevent me from claiming back stamp duty if home A sells soon?  Am I okay to make home B my primary residence for council tax purposes and to update details with my bank etc? Do I need to tell HRMC? 

user1977

No, none of that matters.

bobster2

Yes - if you sell Home A within 3 years you can claim back the additional SDLT.

Moving into Home B and making it your residence now does not prevent this.

Flugelhorn

we did this - not sure we defined anywhere as being our main residence - bought new home in April and sold the old one in September - refunded tax appeared a few weeks after we claimed it in the September 

SDLT_Geek

I am assuming that Home B is in England, so the relevant stamp duty is stamp duty land tax.

It is a positive requirement of being entitled to a refund that you bought Home B intending to live in it as your only or main residence.  So an explanation is called for as to why you have not moved in yet.

• If the delay was because you needed to do some work to it before you move in, then that is fine.
• If you have been renting it out, then you are likely sunk on the right to a refund.

There is some guidance here: https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm09812

Slinky

Regarding the observation about renting B sinking the right to a refund, we bought our House B whilst still living in House A. We did some work to B, then rented it out for 15 months before selling A and moving into B, two years after purchase. The rental issue with B did not prevent us reclaiming the SDLT as we had shown it was always our intention to make it our primary residence, by moving into it.

SDLT_Geek

Slinky said:

Regarding the observation about renting B sinking the right to a refund, we bought our House B whilst still living in House A. We did some work to B, then rented it out for 15 months before selling A and moving into B, two years after purchase. The rental issue with B did not prevent us reclaiming the SDLT as we had shown it was always our intention to make it our primary residence, by moving into it.

I would be interested to know more about this if you are prepared to give details (you might prefer not to say any more). 

Was the refund agreed with HMRC in correspondence, or was it just done on the usual application form on a self-assessed basis?

doby1515

Thanks all for your responses much appreciated. 

Slinky

SDLT_Geek said:

Slinky said:

Regarding the observation about renting B sinking the right to a refund, we bought our House B whilst still living in House A. We did some work to B, then rented it out for 15 months before selling A and moving into B, two years after purchase. The rental issue with B did not prevent us reclaiming the SDLT as we had shown it was always our intention to make it our primary residence, by moving into it.

I would be interested to know more about this if you are prepared to give details (you might prefer not to say any more). 

Was the refund agreed with HMRC in correspondence, or was it just done on the usual application form on a self-assessed basis?

We just applied as normal when we sold our original house and moved into the second one.  We'd declared the rental income on our tax returns.

SDLT_Geek

Slinky said:

SDLT_Geek said:

Slinky said:

Regarding the observation about renting B sinking the right to a refund, we bought our House B whilst still living in House A. We did some work to B, then rented it out for 15 months before selling A and moving into B, two years after purchase. The rental issue with B did not prevent us reclaiming the SDLT as we had shown it was always our intention to make it our primary residence, by moving into it.

I would be interested to know more about this if you are prepared to give details (you might prefer not to say any more). 

Was the refund agreed with HMRC in correspondence, or was it just done on the usual application form on a self-assessed basis?

We just applied as normal when we sold our original house and moved into the second one.  We'd declared the rental income on our tax returns.

So you "self-assessed" it then.  The form is less an "application" than an amendment to a tax return. 

HMRC guidance says that their view of the law is that the refund is not due if a decision is made to rent out the new house before moving into it: https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm09812

Slinky

Oh dear. Won't worry about it too much now 5 years later. We only rented it out to keep it from standing empty across the winter and the rent barely covered the costs of bringing it up to a rental standard.