What are the SDLT consequences of the transfer of an interest in the former matrimonial home on separation?
Divorce
“A and B have owned a matrimonial home which is their main residence for approx. 10 years and have now decided to separate. A is remaining in the main residence. There is no court order or separation deed. B is transferring his interest in the matrimonial home to A and the consideration is £56,000 being half the outstanding mortgage.
A has owned a buy to let property for about 13 years.
We are acting for A, but the Bank on the new mortgage have instructed other solicitors and they state that the transfer is subject to Stamp Duty at the higher rate. I should be grateful if you could let me know whether the Bank’s solicitors are correct”.
Source: George
A transaction between one party to a marriage and the other is exempt from the charge to SDLT if it is carried out at any time in pursuance of an agreement of the parties made in contemplation of or otherwise in connection with the dissolution or annulment of the marriage, their judicial separation or the making of a separation order in respect of them. If this is not the case here, the additional 3% surcharge will apply as A owns another dwelling (the buy-to-let) and is not replacing his only or main residence.
At the time of publication this response was correct however as tax legislation and practice change from time-to-time you should take specific advice before taking any action.
For further guidance on SDLT please see Ann’s Stamp Duty Land Tax Q&As. This free resource covers a wide range of SDLT queries and you can filter the results to find a specific query.
To be notified when new Q&As are published please sign up for alerts here.