Avoiding a Costly Stamp Duty Mistake
August 23, 2024
A married couple were planning to sell their respective main residences and buy a new home together. They were concerned about paying additional rates due to the wife's Buy-to-Let (B2L) property. However, they were relieved to learn that they wouldn't be subject to Higher Rate Additional Dwelling Stamp Duty (HRAD) as they were both selling their main homes and purchasing a single primary residence.
The couple initially believed their HRAD liability would be £136,250. However, after consulting with a tax advisor, they discovered that the correct calculation was only £91,250. This accurate calculation resulted in a significant saving of £45,000.
This story emphasizes the importance of seeking professional advice and ensuring accurate calculations when dealing with Stamp Duty. A small error in the calculation can lead to substantial financial losses. In this case, the couple were fortunate to have discovered the mistake and avoided paying an unnecessary £45,000.
If both partners are selling their main residences to purchase a single primary residence, it does not matter if they own additional property. The key factor is that they are both disposing of their main homes and acquiring a new one together.
This scenario highlights the complexity of Stamp Duty regulations and the potential financial implications of miscalculations. It is crucial to obtain expert guidance to ensure accurate assessments and avoid unnecessary costs.
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