Question on stamp duty

[OwlHoot]

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?

[AtW]

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.

[OwlHoot]

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).

[AtW]

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.

[DimPrawn]

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.

[Mordac]

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).

[OwlHoot]

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.

[OwlHoot]

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?

[AtW]

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

[DimPrawn]

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.