Does the 3% SDLT surcharge always apply where a dwelling is acquired by a company?


“I am a conveyancing solicitor and have been instructed by a client to sell her existing home to a limited company, in which she is the sole director and Person in Significant Control (PSC). Sale is at the market price. She has also instructed me to act in her proposed purchase of a new home. Sale and purchase will be completed simultaneously. On completion there will be only one property in her personal name. Do you think higher stamp duty will be payable on her proposed new home purchase due to the fact that she is the sole director and PSC.”

Source: Victor 


The sale by your client to the company will be subject to the 3% SDLT surcharge unless the dwelling has a market value of more that £500,000 when the 15% ‘super rate’ for company purchasers will apply and the 3% surcharge will not.

As your client will not own any other dwelling at the end of the day of completion of the purchase of her new home the surcharge will not apply to that purchase.  In any event, the relief for replacement of an only or main residence would probably be available.

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.

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