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    • steph2901
    • By steph2901 10th Apr 18, 8:12 PM
    • 310Posts
    • 204Thanks
    steph2901
    Stamp Duty Query
    • #1
    • 10th Apr 18, 8:12 PM
    Stamp Duty Query 10th Apr 18 at 8:12 PM
    Hi everyone,

    I'm in the process of buying a house with my husband, the price is 118,000.

    He owns a house which he rents out (mortgage of 40K left and house not worth much more due to falling prices in that area), he's not lived there for about 3 years. He moved in with me in 2015 and I sold my house in 2016 as we were going to buy a house together (and I had to pay ex). That didn't quite go to plan at the time and we've been renting 18 months.

    So my question is, do we pay the 3% stamp duty on the house we are buying?
Page 1
    • SDLT Geek
    • By SDLT Geek 10th Apr 18, 8:48 PM
    • 307 Posts
    • 181 Thanks
    SDLT Geek
    • #2
    • 10th Apr 18, 8:48 PM
    • #2
    • 10th Apr 18, 8:48 PM
    So were you married to your now husband when your house was sold in 2016? How long did he live in that house with you? At the time he lived with you was that just a temporary measure? Or was it seen as a long term arrangement at the time and there was a change of plan?

    If he lived with you with the necessary degree of permanence and expectation of continuity for it to be his only or main residence and you sold that property when married to him then the exception from the surcharge for the replacement of an only or main residence should apply.
    • 00ec25
    • By 00ec25 10th Apr 18, 8:48 PM
    • 6,989 Posts
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    00ec25
    • #3
    • 10th Apr 18, 8:48 PM
    • #3
    • 10th Apr 18, 8:48 PM
    you will pay the standard rate, not the higher rate because you are replacing a main residence within 3 years of ceasing to live there: 2016 + 3 being less than 2018. Occupation of a rental in-between is ignored

    https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm09800
    For transactions on and after 22 November 2017, there are three parts to this test:

    the purchaser must have disposed of the whole of their major interest in the previous main residence [Para 3(6)(ba) and Para 3(7)(ba)],
    the dwelling acquired must be intended to be occupied as the individual!!!8217;s only or main residence [Paras 3(6) (a) and 3(7) (a)]
    the purchaser must have lived in the previous main residence they!!!8217;ve disposed of at some time in the 3 years ending with the date they purchase their new main residence [Para 3(6)(c) and Para 3(7)(c)]
    • steph2901
    • By steph2901 10th Apr 18, 8:54 PM
    • 310 Posts
    • 204 Thanks
    steph2901
    • #4
    • 10th Apr 18, 8:54 PM
    • #4
    • 10th Apr 18, 8:54 PM
    Yes, we got married in July 2015. We lived together in the house I owned from beginning of 2015 until it sold in September 2016. No, it wasn't a temporary thing him living with me. He had tried to sell his house and couldn't, so he rented it out and moved in with me.

    I then had to sell the house to pay off ex-husband. We tried to buy a house but it fell through so we've rented since September 2016 until we found a house we wanted.

    Thanks for replying
    • SDLT Geek
    • By SDLT Geek 10th Apr 18, 9:52 PM
    • 307 Posts
    • 181 Thanks
    SDLT Geek
    • #5
    • 10th Apr 18, 9:52 PM
    SDLT replacement exception
    • #5
    • 10th Apr 18, 9:52 PM
    So in the case of joint buyers, to see if the 3% surcharge is due, one has to look at it as if each buyer was buying alone. If for either of them buying alone the surcharge would be due, then it is due for the whole transaction.

    You buying alone would not pay the surcharge. Condition C is not met as you have no other property.

    Your husband buying alone should escape the surcharge. Condition D is not met. The replacement exception applies by virtue of your sale of a property he used to live in as his only or main residence.

    Take it with a pinch of salt if someone says spouses are treated as a single unit. It is true though that if one spouse alone buys, one treats it for surcharge purposes as if the other spouse was a joint buyer. Also a person can rely on a sale by a spouse of a property that the person used to live in as their only or main residence.
    • steph2901
    • By steph2901 11th Apr 18, 6:25 AM
    • 310 Posts
    • 204 Thanks
    steph2901
    • #6
    • 11th Apr 18, 6:25 AM
    • #6
    • 11th Apr 18, 6:25 AM
    So that means the higher rate doesn't apply?
    • 00ec25
    • By 00ec25 11th Apr 18, 8:27 AM
    • 6,989 Posts
    • 6,660 Thanks
    00ec25
    • #7
    • 11th Apr 18, 8:27 AM
    • #7
    • 11th Apr 18, 8:27 AM
    So that means the higher rate doesn't apply?
    Originally posted by steph2901
    you (as a couple) will pay the standard rate, NOT the higher rate
    • SDLT Geek
    • By SDLT Geek 11th Apr 18, 8:42 AM
    • 307 Posts
    • 181 Thanks
    SDLT Geek
    • #8
    • 11th Apr 18, 8:42 AM
    • #8
    • 11th Apr 18, 8:42 AM
    That is right, from what you say the higher rates should not apply, but do check the details with your conveyancer. I suggest you choose one who is familiar with the surcharge.

    I suggest you keep evidence that you owned and sold the previous property, also that you both lived there.

    Hopefully you will complete your purchase within the required three years of your sale / moving out of the old property in September 2016.
    • SDLT Geek
    • By SDLT Geek 11th Apr 18, 8:43 AM
    • 307 Posts
    • 181 Thanks
    SDLT Geek
    • #9
    • 11th Apr 18, 8:43 AM
    • #9
    • 11th Apr 18, 8:43 AM
    That is right, from what you say the higher rates should not apply, but do check the details with your conveyancer. I suggest you choose one who is familiar with the surcharge.

    I suggest you keep evidence that you owned and sold the previous property, also that you both lived there.

    Hopefully you will complete your purchase within the required three years of your sale / moving out of the old property in September 2016.
    • steph2901
    • By steph2901 11th Apr 18, 4:20 PM
    • 310 Posts
    • 204 Thanks
    steph2901
    Thanks, we both show on our credit files as living there previously (I was there 11 years) and I'll have to see whether I've got any paperwork from when I sold it.
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