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Nicola-mod
Nicola-mod, Moderator
Category: Tax
Satisfied Customers: 21
Experience:  Moderator
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I have a client who rents residential property out he is considering

Customer Question

I have a client who rents residential property out he is considering buying 2 additional properties in one transaction from a developer who is building 5 properties on this site (Lincolnshire).

both properties are being bought in one transaction each one @ £103,000 which is below the stamp duty threshold but together will be over the threshold £206.000

Will they be subject to stamp duty.

If yes would it make any difference if they were bought in 2 separate transactions
Submitted: 4 years ago.
Category: Tax
Expert:  TonyTax replied 4 years ago.
Hi.

Where multiple properties are being bought as part of a linked transaction (from the same vendor or where the buying and selling parties are linked) the SDLT can be higher than if the properties were bought individually as it is treated as a single transaction. To counter this, relief can be claimed as described here. There is more commentary here and here subject to a minimum charge of 1%.

Even if the properties are bought individually and no SDLT is paid, it is possible that HMRC will look at the transactions with a view to proving that they were effectively part of a deal between buyer and seller and taxing the two transactions as one accordingly especially if the transactions are in close proximity in terms of time and the purchase prices reflected a discount compared to other single purchases by other buyers.

I hope this helps but let me know if you have any further questions.
Expert:  Nicola-mod replied 4 years ago.
Hello,

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Thank you,
Nicola