Budget 2018 – Higher SDLT rates

Featuring Lisa Macpherson | 29th October, 2018

SDLT additional rate

Higher rates of SDLT apply where individuals who already own residential property buy additional dwellings, generally at 3% above the standard rates. One exception is where someone sells an old home and buys a new home. The higher SDLT rates won’t be chargeable if the old home is sold before the new home is bought or if the old home is sold within three years of buying the new home (although in that case,  the higher rate must be paid upfront and can be claimed back so long as certain conditions are met).

Time limits for amended returns

Someone selling their old home after they buy their new home must pay upfront but can reclaim the higher rates for additional dwellings provided they sell their old home within three years of buying their new home. Current time limits require a claim to be made by the later of:

  • Three months from selling the old home
  • A year from the filing date for the SDLT return for the new home.

In practice this means that anyone who fails to sell their old home within 12 months of the filing date of the SDLT return for their new home must reclaim their higher rates for additional dwellings within three months of the sale of their old home. For sales of previous homes substantially completed on or after 29 October, these time limits will be changed to the later of:

  • 12 months from selling the old home
  • A year from the filing date for the SDLT return for the new home.

Undivided shares in additional dwellings

Broadly, additional rate SDLT is charged when someone buys an interest in a dwelling and already owns a ‘major interest’ in another dwelling. HMRC intends to make minor changes to the legislation, to put beyond doubt that it applies to all purchases of undivided shares in land, and make clearer that a major interest in a dwelling includes an undivided share in a dwelling for the purpose of the additional rate charge.

Get in Touch

How would you like to be contacted?

GDPR Consent

For more information read our privacy policy and terms and conditions.

More like this

Looking for more?
Insights
Get Regular Insights
Sign Up