Is our solicitor wrong when she says we owe £10,500 in stamp duty?

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Q My husband and I are due to exchange on a house today and we were under the impression during the four-month conveyancing process that we would not have to pay stamp duty because we were buying a replacement for the main residence we had sold. Our solicitor, however, has told us we are liable for £10,500 of SDLT as my husband owns a buy-to-let flat (it was his previous residence when we met five years ago) but I think she is advising us incorrectly. Based on an article of yours a few years back, and the government guidelines detailed in it, I think we should still be exempt as we are replacing our main residence with this sale and purchase. Is it as simple as that?

A Yes, it is that simple and the stamp duty land tax (SDLT) guidance published in March 2016 has not changed. Under the heading “higher rates for additional properties”, it says: “You will not pay the extra 3% SDLT if the property you are buying is replacing your main residence and that has already been sold”. In your case, because you have sold your main residence and are buying a new one to replace it, you should not have to pay the higher rate of SDLT. To confirm this, you might want to get your solicitor to use the SDLT calculator mentioned in the guidance.

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Using it, I applied the current zero rate of SDLT to a notional purchase of £490,000 after having answered “yes” to the questions “Will the purchase of the property result in owning two or more properties?” and “Is the property being purchased replacing your main residence?”. Had I answered “no” to that last question – because the first main residence had not been sold – the higher rates would have been charged. However, a rebate would have been available as long as the main residence not yet sold was sold within three years of buying the new one.

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