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Aston Lawyer
Aston Lawyer, Solicitor
Category: Property Law
Satisfied Customers: 10862
Experience:  LLB(HONS) 23 years of experience in dealing with Conveyancing and Property Law
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Can anyone advise on stamp duty issues relating to the 3%

Customer Question

Can anyone advise on stamp duty issues relating to the 3% sur charge
Submitted: 8 months ago.
Category: Property Law
Customer: replied 8 months ago.
My query is related to how much stamp duty I should be paying on buying a new house with my partner for us to live in.
At present I live at home with my parents.
I first bought a 1-bedroom apartment for letting in 26 June 2009 which I still own.
On 15 August 2016 I bought a residential home (and paid the standard 2% stamp duty) to live in with my partner. Unfortunately, it did not work out so, we sold that house on 25 July 2017, and I returned home to live with my parents.
Shortly after this, on 18 December 2017, I decided to buy another house for letting (using a buy-to-let mortgage), and paid the new stamp duty charge of an extra 3%.
Since July 2017 I have continued to live with my parents but have now met a new partner and am buying a house with a residential mortgage for us to move into in the next few weeks. As I bought the original apartment (2009) before the stamp duty changes in April 2016, I consider that the house I am now in the process of buying that I should be liable only for the standard 2% stamp duty. I welcome your opinion.
Expert:  Aston Lawyer replied 8 months ago.

Hi Ken, I am afraid you will be liable to pay the Stamp Duty at the enhanced rate. This is because even though you are buying a property to reside within, you are not replacing your main residence, and you already own another property (in your case 2 properties).

The rules are very strict and the only potential way of avoiding the enhanced rate would be if the property is purchased in the sole name of your partner (provided she does not already own any other property) although this may not of course be feasible or practical for you.

Sorry this is not the answer you were looking for. If I have answered your question, I would be grateful if you could rate my answer in the top right hand corner of your screen.

Kind Regards Al

Customer: replied 8 months ago.
Many thanks for your prompt reply.The reason for my query is because my solicitor had said the same as yourself. However, the reason I needed to check this out is because I am actually replacing my main residence - my parent's home. Does the property law state that if I had owned my parent's home and lived in it as my main residence, then sold it to buy my next main residence then I would not have had to pay the enhanced stamp duty? It strikes me that if this is the case it is really unfair on young persons when buying their first residential home. Because I was unsure of my solicitor's views on this as being right, and because I considered he was incorrect, I had already a consulted a solicitor from "Which" magazine who confirmed that I was correct and there should not be any enhanced stamp duty. But I needed absolute confirmation on this, hence my contacting you today for a second opinion. I am now really confused because it seems that three specialist property solicitors have different opinions on the application of the new enhanced stamp duty!
Expert:  Aston Lawyer replied 8 months ago.

Hi, thanks for your reply. If you owned your "parents house" and you were selling that at the same time as buying your new property then you would only have to pay the standard rate, as you would be replacing your main residence. However, I do not believe that you do own your "parents house" and I don't think you are selling it either. If so, I'm afraid my first answer remains the same and is the correct legal position.

If you want peace of mind, bearing in mind what the Which Solicitor has told you, please feel free to speak to HMRC.

Kind Regards Al