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I am afraid that there is no way around it. You will be paying the higher rate stamp duty as you own multiple properties. It is people like yourself the legislation was designed to catch.
If you want to keep your other properties you will have the pay the additional taxes associated with the transaction.
Originally posted by haras_nosirrah
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This isnt correct. Long post!
The 3% additional stamp duty is based on primary place of residence. A couple can own 1000 Buy to Let properties, and have one property they use as their primary place of residence. If they buy another property and move into it, and dispose of their former primary residence, they do not pay the extra 3%.
If they keep their former private residence, because they haven't disposed of it they have to pay the additional 3% on the new property.
So if the OP wanted to keep the old property, and avoid the 3% on the new property they have to dispose of the old. This can be achieved by setting up a Limited Company that buys the old property.
In this case the company would pay the stamp duty on the 350K valuation. Which including the 3% surcharge equals £18000. The new property being bought by the OP would then be exempt the 3% so on a 550K purchase they would pay £17500. 35.5K total
If the Op kept the original property, and didnt sell it to a company that he forms, he would be liable to the additional 3% so the total stamp on 550K would be 34K. So in this case, its actually cheaper to not set up the lld company if all we are trying to do is save stamp. We didnt know all the figures at the start of this thread.
However the OP has indicated that he has a number of BTL properties, so going forward he is going to be hit with Clause 24 so a Ltd Coy could be a solution to cut that tax bill dependant upon circumstances