reclaiming SDLT

ApertureBill

Hi, I'm new to this so please forgive me if I get a few things wrong.  My wife and I are planning on moving up to the North from the London area and want to buy a small place as a foothold before we sell our main home.  We are aware that we will need to pay the higher rate of Stamp Duty and that we can claim back the higher rate once our current home sells which we expect would be within 12 months.   Our intention is to then look around for a forever home once we are in the area and probably do the same thing, ie buy the forever home then sell the foothold property and claim the higher rate of SDLT back again.  Our thinking is that we will be in a stronger position as cash buyers with no chain.   My question is, are there any restrictions to doing this the second time.  I read the HMRC guidance and I was bit confused if there was a requirement to wait 3 years before being able to claim the next refund.  I hope that makes sense and grateful for any sage advice.

SDLT_Geek

ApertureBill said:

Hi, I'm new to this so please forgive me if I get a few things wrong.  My wife and I are planning on moving up to the North from the London area and want to buy a small place as a foothold before we sell our main home.  We are aware that we will need to pay the higher rate of Stamp Duty and that we can claim back the higher rate once our current home sells which we expect would be within 12 months.   Our intention is to then look around for a forever home once we are in the area and probably do the same thing, ie buy the forever home then sell the foothold property and claim the higher rate of SDLT back again.  Our thinking is that we will be in a stronger position as cash buyers with no chain.   My question is, are there any restrictions to doing this the second time.  I read the HMRC guidance and I was bit confused if there was a requirement to wait 3 years before being able to claim the next refund.  I hope that makes sense and grateful for any sage advice.

You will find the guidance here helpful, I expect: https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm09800

There is no objection as such to the rules applying a number of times in respect of different house moves.

The potential weakness is whether you will meet the requirement in respect of the "small place" about when you buy it, you intend to live in it as your only or main residence.  You describe it as a "foothold" and do not intend to live in if for long.  Will you have the "necessary degree of permanence and expectation of continuity" for it to count as your only or main residence?  The tests are mentioned briefly here: https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm09812

ApertureBill

Thanks for the advice and the links - really helpful.  I think the tests will be ok for us but again, thanks for the comprehensive response.