Your browser isn't supported
It looks like you're using an old web browser. To get the most out of the site and to ensure guides display correctly, we suggest upgrading your browser now. Download the latest:

Welcome to the MSE Forums

We're home to a fantastic community of MoneySavers but anyone can post. Please exercise caution & report spam, illegal, offensive or libellous posts/messages: click "report" or email forumteam@.

Search
  • FIRST POST
    • James Day
    • By James Day 9th Nov 18, 9:03 PM
    • 4Posts
    • 1Thanks
    James Day
    Stamp Duty: First time Buyer Marries Homeowner + new property
    • #1
    • 9th Nov 18, 9:03 PM
    Stamp Duty: First time Buyer Marries Homeowner + new property 9th Nov 18 at 9:03 PM
    Hi,

    I am hoping that this thread can clear up my confusion where I stand with stamp duty rates and tax, I have done a lot of research on the web only to find conflicted answers and some of whom were solicitors.

    The scenario is this:

    I have been saving as a first time buyer to buy my own home for about 10 years, I recently married my partner who already owns a property (the property and mortgage are solely in her name on the deeds etc. and i consider this her property and not mine - even in the event of divorce).

    Since marriage my plan was to buy my own home (solely my name on the deeds and mortgage etc,) separate to my wife as we like our own space and storage and I work away alot etc. - you could say we are not that traditional.

    To my shock I have recently learnt during a conversation with someone that as I am married not only am I not considered a first time buyer anymore that also this would be considered a second home (even though my wife and I deem our finances to be separate and the property is in her own name) and hence I would have to pay higher rate of stamp duty should i buy my own house (i.e. it would be around 10k stamp duty tax) which is not feasible for me as I can't just throw that sort of money away to the government. I seemed to have jumped from saving for my first home as a first time buyer, to a buyer of a second home just for being married.

    What happens if I separate from my partner? does this mean I would still have to pay higher rate of stamp duty tax if I bought a home (it would be 10k ish) unless we were divorced? This feels very harsh to me as I was saving for my first home before marriage, and as I moved into my wife's home I would leave 'her' property upon separating - I would have to pay the higher rate of stamp duty while separated until divorced would mean I am locked out of buying a house (that i would consider my first house) and I would have to rent again. Not sure if this would violate some sort of human right?

    If I get divorced would I then be considered a first time buyer again for stamp duty purposes and be exempt from stamp duty tax? or because I have been married to a homeowner (even if they 100% keep their house and 0% to me) will I never be classed as a first time buyer ever again for stamp duty purposes?

    I am not sure if anything I have said is true or not at this stage - its a bit of a confusion at the moment but would like to know where I stand before looking for a house on my own to see if this is feasible for me anymore.

    Thanks in advance.
Page 1
    • SDLT Geek
    • By SDLT Geek 9th Nov 18, 10:23 PM
    • 426 Posts
    • 262 Thanks
    SDLT Geek
    • #2
    • 9th Nov 18, 10:23 PM
    • #2
    • 9th Nov 18, 10:23 PM
    As things stand, when you buy the higher rates would be due.

    If someone in a similar position to you was separated from their spouse in circumstances likely to prove permanent they would qualify as a first time buyer.

    If someone in a similar position to you was divorced from their spouse they would qualify as a first time buyer.

    This is all hypothetical presumably, given that you have only just married.
    • trailingspouse
    • By trailingspouse 10th Nov 18, 9:18 AM
    • 3,350 Posts
    • 5,535 Thanks
    trailingspouse
    • #3
    • 10th Nov 18, 9:18 AM
    • #3
    • 10th Nov 18, 9:18 AM
    On a separate post, a couple of weeks ago, someone was criticised for asking what the score would be financially if he (hypothetically) married and then divorced. He was shot down in flames for being unromantic.
    But I made the point on that thread, and I'll make it again here - real life is not like a Disney movie. We all need to get much more clued-up about precisely how being married will affect us financially, and have those conversations with the people we want to share our life with.

    I think you, OP, have had that conversation, and the two of you are being very straightforward with each other about wanting to retain your financial independence. Unfortunately the system isn't set up to cope with it.
    • AdrianC
    • By AdrianC 10th Nov 18, 9:29 AM
    • 20,448 Posts
    • 19,114 Thanks
    AdrianC
    • #4
    • 10th Nov 18, 9:29 AM
    • #4
    • 10th Nov 18, 9:29 AM
    A married couple is treated as a single entity for SDLT.

    Even disregarding the marriage, if the two of you were to buy as joint owners, then there is a non-FTB in the purchase - who owns another property, so not only would there be no FTB discount on SDLT, but the +3% hike would apply.


    Not sure if this would violate some sort of human right?
    No, it really doesn't.
    • p00hsticks
    • By p00hsticks 10th Nov 18, 9:31 AM
    • 6,610 Posts
    • 7,160 Thanks
    p00hsticks
    • #5
    • 10th Nov 18, 9:31 AM
    • #5
    • 10th Nov 18, 9:31 AM
    I think you, OP, have had that conversation, and the two of you are being very straightforward with each other about wanting to retain your financial independence. Unfortunately the system isn't set up to cope with it.
    Originally posted by trailingspouse

    The problem is that they don't appear to have had the conversation before they got married, which is when they should have - prior to marriage the OP could have bought his/her own property without all the hurdles and additional costs s/he now face.
    • davidmcn
    • By davidmcn 10th Nov 18, 9:35 AM
    • 9,678 Posts
    • 10,383 Thanks
    davidmcn
    • #6
    • 10th Nov 18, 9:35 AM
    • #6
    • 10th Nov 18, 9:35 AM
    This is all hypothetical presumably, given that you have only just married.
    Originally posted by SDLT Geek
    "Sorry darling, I'm going to have to dump you for tax reasons."
    • 00ec25
    • By 00ec25 10th Nov 18, 9:47 AM
    • 7,517 Posts
    • 7,210 Thanks
    00ec25
    • #7
    • 10th Nov 18, 9:47 AM
    • #7
    • 10th Nov 18, 9:47 AM
    Not sure if this would violate some sort of human right?.
    Originally posted by James Day
    please do not trivialise a vital concept for the sake of your financial greed

    your research should easily have confirmed:

    a) co-ownership means the rules are tested against each individual alone. If one fails then both fail together. Does not matter if the co-owners are married or not in that context.

    b) if you buy as sole owner, you are tested as sole owner.
    Last edited by 00ec25; 10-11-2018 at 1:13 PM.
    • -taff
    • By -taff 10th Nov 18, 11:02 AM
    • 9,112 Posts
    • 9,760 Thanks
    -taff
    • #8
    • 10th Nov 18, 11:02 AM
    • #8
    • 10th Nov 18, 11:02 AM
    Not sure if this would violate some sort of human right?.
    Originally posted by James Day

    Paying more tax is not a violation of a basic human right...
    • sheramber
    • By sheramber 10th Nov 18, 11:14 AM
    • 5,669 Posts
    • 4,323 Thanks
    sheramber
    • #9
    • 10th Nov 18, 11:14 AM
    • #9
    • 10th Nov 18, 11:14 AM
    So you would ditch your wife for the sake of £10k?
    • xylophone
    • By xylophone 10th Nov 18, 12:41 PM
    • 28,012 Posts
    • 16,900 Thanks
    xylophone
    wanting to retain your financial independence.
    Seems to be more than that going on here....

    Since marriage my plan was to buy my own home (solely my name on the deeds and mortgage etc,) separate to my wife as we like our own space and storage and I work away alot etc. - you could say we are not that traditional.
    You'd wonder why they bothered to get married.....can it have been for tax reasons......
    • Beeper
    • By Beeper 26th Dec 18, 3:32 PM
    • 23 Posts
    • 4 Thanks
    Beeper
    Hi everyone!

    So this came up yesterday at the Christmas lunch. Everyone (but me) said ‘if you’re the only one named on your property, the spouse can buy a second property and still be a first time buyer and qualify for SDLT if they make it their main residence’. I said that wouldn’t be the case, as a married couple you’d both have an interest in property number one and so not qualify for SDLT. The majority vote won and I was promptly shot down.

    I’ve read the gov. doc, first time buyer definition:
    ‘In order to count as a first time buyer, a purchaser must not, either alone or with others, have previously acquired a major interest in a dwelling or an equivalent interest in land situated anywhere in the world.’

    But can’t find anything that says a married couple would be assessed a single unit for SDLT. Where would this be? Thanks
    • unforeseen
    • By unforeseen 26th Dec 18, 4:14 PM
    • 3,373 Posts
    • 4,512 Thanks
    unforeseen
    From https://www.gov.uk/government/consultations/consultation-on-higher-rates-of-stamp-duty-land-tax-sdlt-on-purchases-of-additional-residential-properties/higher-rates-of-stamp-duty-land-tax-sdlt-on-purchases-of-additional-residential-properties

    The government will treat married couples and civil partners living together as one unit. This is consistent with other areas of the tax system including Capital Gains Tax private residence relief where married couples are entitled to relief on one residence between them.

    This means that:

    married couples and civil partners may own one main residence between them at any one time for the purposes of the higher rates
    property owned by either partner (and any minor children) will be relevant when determining if an additional property is being purchased or not. Therefore, an individual buying a property may be liable for the higher rates if his or her spouse or civil partner has an existing residential property. If the spouse or civil partner then sells that residential property they may be able to claim a refund
    Married couples and civil partners are treated as living together, and therefore as one unit, unless they are separated:

    under a court order; or
    by a formal Deed of Separation executed under seal.
    • Beeper
    • By Beeper 26th Dec 18, 4:19 PM
    • 23 Posts
    • 4 Thanks
    Beeper
    thank you
    • SDLT Geek
    • By SDLT Geek 26th Dec 18, 4:31 PM
    • 426 Posts
    • 262 Thanks
    SDLT Geek
    First time buyers' relief overridden by 3% surcharge, spouses
    But canít find anything that says a married couple would be assessed a single unit for SDLT. Where would this be? Thanks
    Originally posted by Beeper
    Nowhere in the SDLT legislation does it say that a married couple is treated as a single unit. What sinks you though is a combination of things:

    1. First time buyers' relief is not available if the higher rates of SDLT apply (the 3% surcharge).

    2. For the purpose of the higher rates a purchase has to be judged as if they buyer's spouse was buying the property. If for the spouse buying the higher rates would apply, then the higher rates apply to the purchase.

    As discussed before, this rule does not apply where spouses are separated in circumstances likely to prove permanent.
Welcome to our new Forum!

Our aim is to save you money quickly and easily. We hope you like it!

Forum Team Contact us

Live Stats

1,486Posts Today

7,916Users online

Martin's Twitter
  • RT @paullewismoney: People who were students 1990-97 are being offered the chance to pay off half their unpaid student loan and the other h?

  • As normal I am signing off twitter for the weekend - to spend time with mini and Mrs MSE. Hope you have a wonderfu? https://t.co/FG3sRfkIgA

  • RT @LauraFrancis9: Top crew! We may film in the freeeeeeeezing cold every week, but this bunch make it fun. (And huge thanks as always to @?

  • Follow Martin