I am slightly confused about Stamp Duty. I might be wrong but if anyone knows better please let me know
So is it true that (exclude the stamp duty free period) if you buy your first home let’s say 300K it will be tax free and when you move to your 2nd home and turning 1st one into buy to let you will only be paying Stamp Duty on your 2nd home?
So you buy to let your first home and live in your second home would it be the same Stamp Duty as for a buy to let?
You pay stamp duty (SDLT) on any property you buy over the threshold. If you buy a property for less than the threshold, there’s no SDLT to pay. The current SDLT threshold for residential properties is £500,000. This changes on 1 April 2021. The threshold for non-residential land and properties is £150,000.
If you already own a property then there is an extra 3% levied on top of whatever else you would have paid unless it is a simultaneous sale and purchase of your main residence. If you are buying a property to be your main residence then you can reclaim that extra 3% providing you sell your previous main residence within (I think) 9 months.
So, if you don’t sell your previous property and keep it as a second home or a BTL, then you will have paid an extra 3% on your new main residence.
Tony,
Sir do you know if there is a ceiling on second home tax? If you want to eventually have 20-30 properties.
Or is every property taxed?
Thanks
Marc
every property is taxed
As per my earlier reply and Colin3’s, you pay SDLT on any (and every) property over the threshold. All second residential properties carry a 3% extra rate unless you are a non resident (as I am) in which case it’s 5% additional.
If you are buying that many properties you need advice on setting up a property company and different rates apply for a corporate purchaser. There is also a different CGT regime when you come to sell up.