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We have a client who is thinking about buying a second property. He thinks that the current rental market is very good so is planning on buying a modest three bedroom house that will appeal to a family. The rent he receives will boost his income. However, he has heard that there is a new stamp duty land tax charge for buying a second house. Is that correct? - Crowther Image

There is a new supplementary 3% SDLT (stamp duty land tax) charge that is applied to all purchases of second residential properties which became effective from 1st April 2016. Your client will therefore be liable to this new charge if he already owns the house that he lives in and the transaction to complete the purchase of his rental property has taken place after 1st April 2016.

It should be noted that the new charge will not apply if you are replacing your main home, although if there is a delay between buying a new home and selling the old one, you will have to pay the higher SDLT charge and obtain a refund provided the sale of the old home occurs within 18 months.

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