• Visitors can check out the Forum FAQ by clicking this link. You have to register before you can post: click the REGISTER link above to proceed. To start viewing messages, select the forum that you want to visit from the selection below. View our Forum Privacy Policy.
  • Want to receive the latest contracting news and advice straight to your inbox? Sign up to the ContractorUK newsletter here. Every sign up will also be entered into a draw to WIN £100 Amazon vouchers!

Question on stamp duty

Collapse
X
  •  
  • Filter
  • Time
  • Show
Clear All
new posts

    Question on stamp duty

    Suppose you have a primary residence and a second property currently let. If you sold the primary residence and bought a new primary residence in the usual way, would you be liable for the higher, Buy to Let, stamp duty on the latter just on account of owning the other property?

    I notice the Stamp Duty calculator calls the higher stamp duty rate the "Buy to Let / Additional Home" rate. But arguably you are not buying an additional home if simply exchanging one principle residence for another - Your total number of properties remains unchanged!

    tldr: Does the higher rate stamp duty apply only when buying properties other than a primary residence?
    Work in the public sector? Read the IR35 FAQ here

    #2
    Originally posted by OwlHoot View Post
    Suppose you have a primary residence and a second property currently let. If you sold the primary residence and bought a new primary residence in the usual way, would you be liable for the higher, Buy to Let, stamp duty on the latter just on account of owning the other property?
    Yes.

    Comment


      #3
      Originally posted by AtW View Post
      Yes.
      Do you know that, or are you just guessing?

      As I said, neither half of the weaselly double-barrelled name for this iniquitous higher stamp duty rate applies in the simple scenario I summarized. The purchase would not be for BTL and nor would it be an increase in the number of properties one owned (given that the previous primary residence would be sold at the same time).
      Last edited by OwlHoot; 6 March 2017, 17:26.
      Work in the public sector? Read the IR35 FAQ here

      Comment


        #4
        Originally posted by OwlHoot View Post
        Do you know that, or are you just guessing?
        My sister bought a place in UK and had to pay 3% duty for having primary residence in Russia.

        The way it works is this - if you got ANY other property ANYWHERE then you pay 3%.

        You can try to reclaim back 3% if you dispose of previous main residence with new one being your sole property - they got exception for people who were already in transaction started before Nov 2015 when this tulip was first announced.

        Comment


          #5
          It's very simple. If your name appears at any time on > 1 property (abroad included), you must pay the 3% additional tax. Even if you only own 1% of the other property you still pay.

          Pay, pay, pay and pay. It's very simple.

          Comment


            #6
            Originally posted by OwlHoot View Post
            Suppose you have a primary residence and a second property currently let. If you sold the primary residence and bought a new primary residence in the usual way, would you be liable for the higher, Buy to Let, stamp duty on the latter just on account of owning the other property?

            I notice the Stamp Duty calculator calls the higher stamp duty rate the "Buy to Let / Additional Home" rate. But arguably you are not buying an additional home if simply exchanging one principle residence for another - Your total number of properties remains unchanged!

            tldr: Does the higher rate stamp duty apply only when buying properties other than a primary residence?
            That's not a get out now. It applies to any new purchases if you already own a home (or your spouse / civil partner does) regardless of which is your primary residence, from April 1st. You should probably look at transferring BTLs to a limited company, that seems to be the accepted route according to the radio phone-in show experts, but you'd need to get proper advice from a specialist accountant (which probably isn't your ContractorCo accountant).
            His heart is in the right place - shame we can't say the same about his brain...

            Comment


              #7
              Originally posted by DimPrawn View Post
              It's very simple. If your name appears at any time on > 1 property (abroad included), you must pay the 3% additional tax. Even if you only own 1% of the other property you still pay.

              Pay, pay, pay and pay. It's very simple.
              So among other things anyone with a time share or a permanent holiday caravan berth or beach hut, or even a house boat will be shafted!?

              Mind you, I'd reluctantly concede that anything which deflates the UK property market and discourages buy to letters isn't all bad. Dropping home ownership rates are a serious long term problem, which might one day cause civil unrest and even revolution.
              Work in the public sector? Read the IR35 FAQ here

              Comment


                #8
                Originally posted by Mordac View Post
                You should probably look at transferring BTLs to a limited company ...
                But technically, isn't that a change of ownership and thus itself subject to stamp duty?
                Work in the public sector? Read the IR35 FAQ here

                Comment


                  #9
                  Originally posted by OwlHoot View Post
                  But technically, isn't that a change of ownership and thus itself subject to stamp duty?
                  Yup.

                  Plus there is also an opinion that moving your BTL to a Limited company won't prevent that 3% duty:

                  "Can I avoid the surcharge by setting up a limited company?

                  A. The Government has a keen eye on preventing tax avoidance with this levy, so you won't be able to escape the surcharge by setting up a limited company for the purpose of buying a home or homes."

                  Q&A: The 3% Stamp Duty surcharge on second homes - Zoopla

                  Comment


                    #10
                    Originally posted by OwlHoot View Post
                    But technically, isn't that a change of ownership and thus itself subject to stamp duty?
                    Stamp duty does not apply to businesses.

                    However, they are talking about making sellers pay stamp duty and not buyers, thus getting a double bite of all existing homes.

                    They are gonna bleed us dry.

                    Comment

                    Working...
                    X