"Second Home" stamp duty
Discussion
A slightly odd scenario:
Person A owns House 1
Person A lives with Person B in house 1, main and only residence
Person B is on the mortgage of house 2 with Person C - this was purely so self employed person C could get a mortgage.
Person B has never contributed to house 2, never lived there etc
Person A and B are looking to sell house 1 and move and buy a house
Would this cause the higher stamp duty on a "second home" to be invoked?
The challenging issue is person C getting a mortgage and getting person B off that one, but thats something else altogether.
Person A owns House 1
Person A lives with Person B in house 1, main and only residence
Person B is on the mortgage of house 2 with Person C - this was purely so self employed person C could get a mortgage.
Person B has never contributed to house 2, never lived there etc
Person A and B are looking to sell house 1 and move and buy a house
Would this cause the higher stamp duty on a "second home" to be invoked?
The challenging issue is person C getting a mortgage and getting person B off that one, but thats something else altogether.
Jockman said:
David A said:
Jockman said:
Does person B own the property with person C or just on the mortgage?
I'm not 100% sure, whats the definition of "own" i.e. what do I need to ask / dig out paper work wise?Sarnie said:
Yes.
Person B currently owns 1 property and after the proposed purchase will own 2 properties.......hence the additional stamp duty.
Is that really the case though - I thought there was something about a main residence which for Person B would be House 1 albeit they are not on the mortgage/deeds for that....Person B currently owns 1 property and after the proposed purchase will own 2 properties.......hence the additional stamp duty.
David A said:
Is that really the case though - I thought there was something about a main residence which for Person B would be House 1 albeit they are not on the mortgage/deeds for that....
If person B owned a main residence and was selling it and buying another, then the additional stamp duty wouldn't be payable...........person B owns one property currently and will own 2 once the new purchase completes.....hence the additional stamp............Sarnie said:
David A said:
Is that really the case though - I thought there was something about a main residence which for Person B would be House 1 albeit they are not on the mortgage/deeds for that....
If person B owned a main residence and was selling it and buying another, then the additional stamp duty wouldn't be payable...........person B owns one property currently and will own 2 once the new purchase completes.....hence the additional stamp............David A said:
So it makes no bearing if the house person B "owns" (still need to check if on deeds or just mortgage and does that make a difference) is not and has never ever been a residence for them in any way?
On the contrary - it does have a bearing: it's not their main residence so they're always going to have to pay the 3% surcharge SDLT on any additional residential property purchase, whether or not that is to be their main residence.You can't be on the mortgage but not on the title deeds, though you could be just guarantor (not owner) so do check that.
Jobbo said:
David A said:
So it makes no bearing if the house person B "owns" (still need to check if on deeds or just mortgage and does that make a difference) is not and has never ever been a residence for them in any way?
On the contrary - it does have a bearing: it's not their main residence so they're always going to have to pay the 3% surcharge SDLT on any additional residential property purchase, whether or not that is to be their main residence.You can't be on the mortgage but not on the title deeds, though you could be just guarantor (not owner) so do check that.
NickCQ said:
IIRC the only time when ‘main residence’ is relevant in this situation is when someone already with two properties sells one and buys another. Then, if you are selling a main home to buy a main home, no surcharge. If you are selling a second home to buy a second home, 3% surcharge.
So long as it's done simultaneously Nick otherwise 3% Enhanced Rate is due even on a main residence. You then have 3 years? to sell the original main residence and claim the duty back.Providing b and c agree could a trust not be declared that they are both holding for c upon bare trust and so b having no beneficial interest hence c becoming the qualifying person for sdlt purposes (amongst others). If extra 3% was paid if purchase was in new sdlt regime then trust would have needed to have been in place at purchase. Care need also with regard to the mortgage company's terms.
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