When does the second home / BTL extra 3% stamp duty land tax (SDLT) apply?
We have recently been asked a number of questions concerning the second home /buy-to-let extra 3% stamp duty and when it is applicable. Therefore, the following short article is a simple explanation which aims to answer any questions you may have. However, please do call the Pace sales team should you require further assistance and we will be happy to help.
Example A – Customer owns a house as a ‘main residence’ and is purchasing a buy-to-let property – the higher rate does apply.
Example B – Customer owns two houses, a ‘main residence’ and a buy-to-let. They sell their main residence and purchase another – the higher rate does not apply.
Example C – Customer has a house as a ‘main residence’ and is purchasing a new ‘main residence’ however they have chosen to let the existing ‘main residence’ instead of selling it – the higher rate does apply.
Example D – Customer owns a house as a ‘main residence’ and is purchasing a new ‘main residence’ however they have not yet sold the initial ‘main residence’ – the higher rate does apply but the 3% can be claimed back when the original residential property is sold as long as the sale completes within 18 months of purchasing the new residential property.
The government intends to treat married and civil couples living together as one entity; property owned by either partner will be considered when applying the higher rate of SDLT, i.e. an individual purchasing a property may attract the higher rate if her/his husband/wife owns another property.
This flow chart is from the government website and should help with clarification:
We are happy to offer half an hour of face-to-face advice, free of charge, to local individual considering becoming a landlord.
Please telephone and ask to speak to Marcus or Crystal on 01702 445 606.
Marcus James is Lettings Manager at Pace, an independent Southend on Sea Letting Agent. He deals with every aspect of the property letting process, providing expert and candid advice together with tailor-made marketing plans for each property he lists for rental.
Marcus prides himself on ensuring our landlord clients get the best return in the right timeframe for their investments by conducting rental appraisals, letting viewings and oversees the running of the lettings department.
