My client owns a house worth c £500k, which is currently his only home (house 1).
He is looking to buy a much more expensive house (house 2) in a different area, which will become his main home, but wants to keep house 1 as a holiday home/FHL/investment etc etc.
So obviously this will trigger the 3% stamp duty surcharge on house 2, which will be a significant cost.
His "plan" is to transfer house number 1 into a limited company - which he accepts will lead to stamp duty, including a 3% surcharge, and then he will be able to buy the new house as his only residence so no 3% surcharge.
Stamp duty is not my bag, but is this right? Or will he still have to pay the 3% on house no 2 due to ownership of house no 1 via a company which he and his wife own? I have told him to check this point with a solicitor but just wondering if anyone knew.
I know there are a raft of other issues as well which he needs to be aware of - not least ATED, and BIKs as I am pretty sure he will still use house no 1 as a holiday home. there would be no cgt on transfer of house no 1 as it has been his PPR since he acquired it. If anyone can think of any other reasons why this is not a great idea I would welcome your input!