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taxadvisor.uk
taxadvisor.uk, Chartered Certified Accountant
Category: Tax
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Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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We do not own a house of our own but have an apartment

Resolved Question:

We do not own a house of our own but have an apartment through our business. We are about to purchase a home on a personal level - will we be liable for the higher rate of stamp duty? House cost is £275k
Submitted: 10 months ago.
Category: Tax
Expert:  taxadvisor.uk replied 10 months ago.

Hello and welcome to JustAnswer. I am here to help you. I am reviewing your question and will respond to you shortly.

Expert:  taxadvisor.uk replied 10 months ago.

Thank you for your question...

Please advise if the apartment is owned by the company or yourselves?

many thanks

Customer: replied 10 months ago.
It is owned by the company
Expert:  taxadvisor.uk replied 10 months ago.

Thank you for your reply.

The apartment is owned by the company and not yourselves on a personal level.

You will not be liable to higher rate of stamp duty as you will be owning just one property in your personal names at the end of the day of the transaction.

More information on this can be found here.. look at the flowchart at the bottom of 1.1 Background and 2.2 here

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

I hope this is helpful and answers your question.

If you have any other questions, please ask me before you rate my service – I’ll be happy to respond.

Customer: replied 10 months ago.
Thank you. I presume from reading the obj the fact that it is classed as a holiday home but it is our primary residence and we are renting doesn't matter? Also if we buy a second property in the company's name what would the situation be there? Thank you
Expert:  taxadvisor.uk replied 10 months ago.

Thank you for your reply.

If the company was to purchase a second property, it would have to pay the extra stamp duty.

More information on this can be found here

http://www.thisismoney.co.uk/money/buytolet/article-3394231/Why-concerned-second-home-stamp-duty-reforms.html

As the property is in the company's name and you are renting it, it is deemed not a property in your names.

I hope this is helpful and answers your question.

Customer: replied 10 months ago.
I'm not sure you've answered the first part of my last question? Thanks wil then rate
Expert:  taxadvisor.uk replied 10 months ago.

Thank you for your reply.

If you are referring to this "I presume from reading the obj the fact that it is classed as a holiday home but it is our primary residence and we are renting doesn't matter?"

I had answered it "As the property is in the company's name and you are renting it, it is deemed not a property in your names."

You say the property you are living in as your primary residence is owned by the company and you are renting it. As this property is not in your personal names, you would be able to buy a property in your personal names and you would not have to pay the extra stamp duty.

I hope this is helpful.

Customer: replied 10 months ago.
Sorry if I have confused you, we rent a house and are buying a house that is classed as a holiday home but you can live in it 12 months of the year but it should not be your primary residence. We then have an apartment that we do not live in but rent out that is in the company's name
Expert:  taxadvisor.uk replied 10 months ago.

Thank you for your reply.

As you will be buying the property that would be the only property registered in your names, you would not pay the extra stamp duty.. the purpose does not matter. The condition of sale should not make any difference to stamp duty as it is based on value.

I hope this is helpful.

taxadvisor.uk and other Tax Specialists are ready to help you
Expert:  taxadvisor.uk replied 10 months ago.

I thank you for accepting my answer.

Best wishes

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