Stamp Duty Land Tax relief: top five questions of first time buyers

Jo Morgan, Partner in Coodes Solicitors’ Residential Property team, answers five common questions from first time buyers about Stamp Duty Land Tax relief.

In November 2017, the Government introduced a new relief on Stamp Duty Land Tax for first time buyers. It means that first time buyers purchasing a property for £300,000 or less now pay no Stamp Duty Land Tax. For purchases between £300,000 and £500,000, first time buyers pay a reduced fee.

However, for first time buyers to qualify for the relief the devil is in the detail. Here are answers to the five questions we are most often asked.

1. I am buying my first property but don’t intend to live in it. Can I still benefit from the exemption?

No. The exemption only applies to first time buyers who intend to occupy the dwelling as their only or main residence. If you are buying a property as a buy to let investment, you will need to pay Stamp Duty Land Tax.

2. I am a first time buyer but am buying with someone who has previously owned a property. Does the exemption still apply?

If you are purchasing the property jointly then each buyer needs to be a first time buyer for the exemption to apply.

3. I am a first time buyer, but am buying a property in my company name. Is relief available?

No. Stamp Duty Land Tax relief is only available to individual purchasers, not to companies.

4. I inherited a property abroad a few years ago but have never bought a property. Do I classify as a first time buyer and can I claim Stamp Duty Land Tax relief?

Because you have previously acquired a major interest in a property somewhere in the world you are not classified as a first time buyer for the purposes of Stamp Duty Land Tax relief. Therefore the exemption does not apply to you.

5. I am a first time buyer purchasing a property that includes an annexe used as a holiday let. Does the exemption apply to me?

The first time buyer exemption can only be claimed for purchases of a single dwelling. Where a property includes more than one dwelling, as in the case of an annexe, the relief does not apply.

My previous blog has more details about Stamp Duty Land Tax relief for first time buyers. If you are a first time buyer and have questions about Stamp Duty Land Tax relief, speak to a conveyancing solicitor to make sure you understand what you are entitled to.

For more information, contact the Residential Property team.