My wife and I are in the process of buying a second home in Brighton. I own the primary home, and she lives here too. Could I nominate the new purchase as a primary home to avoid stamp duty land tax (SDLT) and then change the nomination back to my present house? At that point, would I have to pay outstanding SDLT on the new second home? Or does HMRC let you off it? Our solicitor says we must pay the duty.
Arthur Weller replies:
You are referring to the additional 3% SDLT when one buys a second residential dwelling, and the exemption that applies when one buys a new main residence. However, the exemption that applies when purchasing a new main residence only applies when one disposes of the old main residence. See HMRC’s Stamp Duty Land Tax manual. In your scenario, there has been no disposal; so your solicitor is correct.