Shared Ownership Staircasing to 100% - SDLT due?

sharedowershipflat

Hoping someone like @SDLT_Geek will be able to help here - have read great advice to others.

As a first time buyer, I purchased 50% of a brand new shared ownership leasehold flat in June 2019 based on a value of £420000, paying £210000 for the 50%. I did not opt to pay SDLT based on the full value, as even though it would have been a saving overall if the longer term intent was to staircase to 100%, I simply didn't have the extra money required.

I'm now in the fortunate position to staircase to 100%, based on a valuation of £425000, meaning I will pay £212500 for the additional 50%

Is SDLT calculated only on the £212500, or on the full amount? I haven't yet appointed them, but on first query with two different solicitors, they have come back with different answers.

If my reading of the below from the SDLT for shared ownership page is correct, I only pay it on the latest 50%?

"But if the first grant of the lease took place on or after 12 March 2008, this transaction is excluded because it doesn’t count as linked with the rest of the transactions."

ResourcesShared

SDLT on SO is complicated, and we've heard numerous stories of solicitors getting it wrong. You might find this Shared Ownership Resources feature - co-written by SDLT expert, Sean Randall, and SO conveyancing solicitor, Zahrah Aullybocus - helpful in understanding how much you might pay. It's also worth looking at HMRC's information on SO and SDLT, and calling the HMRC SDLT Helpline for their view on your SDLT liability - 0300 200 3510. Links follow.

https://www.sharedownershipresources.org/an-expert-on/stamp-duty-staircasing/

https://www.gov.uk/stamp-duty-land-tax/shared-ownership-property

https://www.gov.uk/find-hmrc-contacts/stamp-duty-land-tax-general-enquiries

sharedowershipflat

Thank you @resourcesshared . There was really clear example on the first link you provided, that I have copy pasted below and replaced with my figures, and believe to be what will be due. It's different to what both of the solicitors had, admittedly only quickly, advised!

The amount of SDLT payable is based on the total amount paid for the lease and the staircasing transaction, £422,500 (£210,000 + £212,500).  So first we work out what the SDLT due on £422,500 would be at the current rates (assuming there is no change in the SDLT rates): this is £11,125. The first £125,000 of the £425,500 is taxed at 0%, the next £125,000 of the £422,500 is taxed at 2% (£2,500), and the final £172,500 of the £422,500 is taxed at 5% (£8,625).

But only part of the £11,125 is payable – the part attributable to the staircasing transaction that resulted in owning over 80%. In this case it is £5,595.42. The relevant part is found by dividing the price paid for the relevant staircasing transaction by the total amount paid: (£212,500 / £422,500) x £11,125. This means that £5595.42 of SDLT is payable on the staircasing transaction within 30 days of the transaction. (Note this is a different deadline to the usual 14-day deadline for filing an SDLT return and paying SDLT.)

SDLT_Geek

https://forums.moneysavingexpert.com/discussion/comment/81981579#Comment_81981579

I agree with your calculation, well done!

SDLT ends up as a round number without pence, so £5,595 of SDLT would be due.

I did not think though that there is an exception here for the usual 14 day filing and payment period. Perhaps the 30 days is referred to in old guidance.