LEGAL AND FINANCIAL
The surcharge applies even if the home you already own (or part-own) is overseas. So, if you have aski chalet in Bulgaria and are buying your first home in the UK, you’ll still be stung with the extra tax.
Q. How much does that translate into? A. As an example, if you are buying a second home with apurchase price of £300,000, just the extra 3% Stamp Duty would equate to £9,000 (3% of the entire price). This is in addition to the £5,000 regular Stamp Duty bill on ahome of this value, making the total payable an eye-watering £14,000.
To get an overall Stamp Duty figure on asecond property,work out the regular cost first then calculate 3% of the purchase price and add the two figures together.
Q. What happens if I’ve split from my partner but my name’s still on the deeds of our home? A. If you are separated or getting divorced and want to buy anew home to live in but your name is still on the deeds of your previous home (which is NOT being sold), this will constitute buying an additional property which means the 3% surcharge will initially apply.However,if you go onto sell your share of the home back to your former partner within 36 months of completing, HMRC will provide afull refund.
Q. What if Iinherit my property? A. No Stamp Duty is payable on properties that are inherited, so the 3% premium will not be relevant. However,ifyou have inherited a property and go onto purchase a second home without selling it, you will be hit with the surcharge.
The March 2016 Budget did hold some reprieve on inherited properties
however.The Government confirmed that asmall share (50% or less) in asingle property which had been inherited within the 36 months prior to buying another home (which would otherwise attract the 3% surcharge) will NOT be considered as an additional property.
Q. Do plots of land count? A. Just like regular Stamp Duty,the 3% loading will only apply to purchases of residential property.Aplot of land (even if it will subsequently be used for ahome) is not counted as residential, so the surcharge will never apply.
Similarly,ifyou already own aplot of land and are buying an additional property,itwill not be considered for purposes of the higher tax.
Source references:
gov.uk,
zoopla.co.uk
raf-ff.org.uk
Autumn 2016
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