The small print of the Budget has revealed that the government is to make minor changes to the ‘additional homes’ three per cent stamp duty surcharge.
The government is stressing that these amendments are purely to improve the operation of the surcharge, by providing relief in certain cases where:
- a court order issued on a divorce or dissolution of a civil partnership prevents someone from disposing of their interest in a main residence;
- an individual buys property from their spouse;
- a person buys a property in a child’s name or on a child’s behalf, where they are doing so in their capacity as the deputy of that child; or
- a purchaser adds to their interest in their existing main residence.
These changes like the stamp duty abolition for first time buyers on homes up to £300,000 - actually came into effect from Wednesday this week.
International consultancy Mishcon de Reya says the latter point regarding purchasers adding to their interest in their existing main residents is particularly helpful “as it gives relief from the surcharge for the price paid for lease extensions on a main residence, which was one of the more unfair applications of the rules.”
The government has also confirmed that the SDLT filing and payment window will be reduced from 30 days to 14 days, applying to transactions with an effective date on and after March 1 2019.
Mishcon says the new time limit will be onerous, particularly on larger scale portfolio transactions, but says the government is planning improvements to the land transaction return process to make compliance with the new time limit easier.