Stamp duty on second home - moving from rental

Is second home stamp duty payable when moving from long term rental property

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My client has asked me if I think he will have to pay the higher rate of SDLT given the following set of circumstances -

Jan 2012 we moved south from a London flat which was our main residence and rented it out. We moved into rented accomodation and have been in rented accomodation since.

May 2013 we bought a buy to let flat which we rented out. We continued to live in rented accomodation

June 2017 we sell original London flat that was main residence. We buy a house that is our new main residence.

My inital though was that he would as his main residence since Jan 2012 for SDLT purposes would be the rented property, and he therefore is not replacing his main residence. However on discussing this with others I'm now not so sure, I would appreciate any thoughts on this.

Replies (10)

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By Justin Bryant
16th Jun 2017 17:02

No 3% SDLT surcharge is payable (but it would be payable if replacement home was bought after 25.11.18 due to 3 year lookback rule applying then*) as condition D is failed (their rented homes in the interim do not cause a Para 3(6)(d) Sch 4ZA FA 2003 problem, assuming no major interest was acquired in them & this is logical if you think about it as often there will be a need for a stopgap rented home).

*Purchase prior to 26.11.2018

The sale** can have occurred at any time in the past regardless as to how long ago this was, and it only has to have been the buyer’s home at some time in that period of time.

Purchase from 26.11.2018

The sale** will have to have been within 3 years for the purchase to count as a replacement and it must have been the buyer’s home at some point during that period.

**The sold main residence must be the last one held since the buyer cannot have bought another main residence between the sale and the current purchase.

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Replying to Justin Bryant:
By yogic accountant
13th Jun 2017 14:16

thanks Justin, that supports my research on this point

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By NO Tax
13th Jun 2017 14:35

If bought New Residence within 3 Years no need for SDLT, also if the new Purchase is for Main Residence then no SDLT for 2nd Property just standard SDLT

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By ohgoodgodno
14th Jun 2017 13:52

your clients main residence has been rented accommodation since January 2012 - hardly an interim situation and they are not replacing this

they have a flat that they already own and let out

purchase of the new house is a second property and yes 3% SDLT will apply

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Replying to ohgoodgodno:
Portia profile image
By Portia Nina Levin
14th Jun 2017 14:03

Somebody just makes 5h1t up without actually reading the legislation, don't they?

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By ohgoodgodno
14th Jun 2017 14:18

if you say so miss piggy

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Replying to ohgoodgodno:
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By Justin Bryant
14th Jun 2017 14:25

I say so too.

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Replying to ohgoodgodno:
By SteveHa
14th Jun 2017 14:38

Me three.

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Replying to ohgoodgodno:
By mrme89
14th Jun 2017 14:44

Burned.

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By gbuckell
15th Jun 2017 10:36

Justin's response is correct.

Take a look at FA 2016 s128(9)

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