I need advice on the new stamp duty rates for second homes

Q Can you give me a bit of advice about the new stamp duty rates for second homes due to come into force in April 2016?

I’m looking to move house and my current home is on the market. I’ve been fortunate recently to have come into an inheritance that will enable me to buy my new home without having to sell my current one.

My plan is still to sell my current home, and ideally I’d like the sale to coincide with the purchase of my new property, as it would if I didn’t have my inheritance to count on. But if I find a new house that I love before my current house sells, I was planning to go ahead with the purchase so as not to lose it by having to wait for the sale of my current house to go through. This means that there may be a period between buying my new home and selling my old one where I own two properties.

Would this mean that the stamp duty applied to the purchase of my new home will be at the higher rate announced in this autumn’s spending review? I worry that this might be the case, even though it’s not intended to be a second home (and nor will I be letting either property out). CM

A If you manage to complete the purchase of your new home before April Fool’s Day 2016, you won’t face the new higher rate of stamp duty even if you still haven’t sold your current home. Otherwise, it’s hard to say because the definitive answer to your question will depend on the outcome of HM Treasury’s planned consultation on the policy detail.

A Treasury spokesman told us that people in your potential position – those buying a second property before selling the first – are likely to have to pay the higher stamp duty rate if the purchase is not completed before the 1 April deadline. But what is also likely is that you will be able to claim back the 3% surcharge provided you sell your old home within 18 months of acquiring the second.

Whether this proposed concession will actually be put in place depends on the outcome of the HM Treasury consultation. This should also determine how parents helping a child get on the property ladder by buying a property jointly with them will be treated. On the face of it, if a parent already owns a residential property, the higher rate should be charged on the second property even if the parent has no plans to live there or let it out.

HM Treasury will also have to think about how to charge someone who converts their existing home to a buy-to-let one and buys another property to live in, as the “additional residential property” would be neither a second home nor a buy-to-let property.