AIBU to think conveyancer wrong about Stamp Duty?

[ConfusedbyConveyancing]

Me and my fiancé are buying a house together. We currently own a property each; he owns a house and I own a flat. We currently live together in his house, and he is selling his house for us to buy the new house together. His house and the new house are both in the same Northern city, whereas my flat is ion down south. I'll continue to own my flat after we have bought the new house together.

Our conveyancer has said that he thinks we will have to pay the higher rate stamp duty on the new house we are buying (due on additional properties) because I will continue to own a residential property.

We both live in my partner’s house currently. There is a lodger living in my flat (not a tenant, as I still sleep there about once a week for work). I am included on the council tax at my partner’s house, our child goes to nursery close to his house, and we are all registered for the GP near his house.

I think that if we were to get married now then we would be (i) buying the new house as an individual, and (ii) replacing our main residence; and would therefore pay the normal rate of stamp duty. I used the gov.uk calculator Stamp Duty Land Tax Calculator to work it out.

I sent the conveyancer a link to the gov.uk stamp duty calculator showing we should attract the normal rate of stamp duty if we get married now, but he said his interpretation is that we will have to pay the higher rate regardless – without really explaining.

The property purchase price is £390,000, so the normal rate of stamp duty would be £9,500, whereas the higher rate would be £29,000. It’s a big difference. :/

Am I unreasonable to expect an explanation from the conveyancer, or is this not his job?

And have I understood the stamp duty rules wrong?

You literally said yo own other property so can't then say you down own other property

She currently has one property. The one she lives in is not owned by her (owned by her partner) and not owned by her spouse (because they’re not married). So for stamp duty purposes it’s not her main residence.

She owns one property
She is not replacing it
She will then own two properties

if you are intending to keep your current property and rent it out you could set up a limited company, sell the property to the company, and the company then rents it out

but there are complexities in tax, directors loans, company accounts and you need proper advice from a well qualified financial and tax advisor.

DH co-owns a share in a property, that’s what I meant by we don’t actually own another property.

.

And also https://wealthandtax.co.uk/can-you-gift-your-house-to-your-children-and-avoid-inheritance-tax/

Remaining in the Property After Gifting
Yes, you can continue to live in the property after gifting it to your children, but you must:

• Pay Market Rent: You need to pay rent at a rate comparable to local rental properties.
• Cover Bills: You must also pay for utilities and other bills associated with the property.

If you were to live in the property rent-free after the transfer, it would be caught by the gift with reservation rules (GWR), meaning it would not be free of IHT because you continue to enjoy effective “ownership” of the asset. It would be as though you never gifted it in the first place. It is an anti-avoidance tax rule.

We had to pay the higher rate of stamp duty when we moved into a new main residence, but couldn’t sell our old house. So for six months that house was unlived in and untouched, but we still had to pay double stamp duty and full council tax on both, which was mind boggling to me.

We did get a stand duty refund when it eventually sold though.

As another poster pointed out there'll be more to be inherited as his parents won't have to pay for care home fees will they? They've protected the house to save care home fees so their care will be funded by tax payers. That 'bad hand' he's been dealt was a savvy hand when it came to securing himself an inheritance. You could view the higher rate as the cost of having that future security.

This thread is so confusing. I thought second home stamp duty applied to ANY second home you buy, regardless of whether you live in it or not.

For example, my partner and I live separately and we're going to sell both our houses and move into one to live in together. I've been told that if one of our houses doesn't sell by the time we complete on the new house, then we will pay second home stamp duty because one of us will own two homes, even though we will be living in only one of them. We can then claim this stamp duty back if we sell the old home within three years.

So I'm very confused.

The advice you have been given is correct. The only exception to the second home stamp duty rules is if you already own two houses and you are selling your main residence for another main residence. You and your partner both own one house each and when you buy a new one jointly you will each own two houses, unless you sell the original ones within the time limit. So sell your current houses before buying.