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  • Tax

    Stamp duty on new leasehold title?

    Hi

    If one freehold house own by husband and wife, convert into two flats, then assign leasehold title to each flat, one flat under husband name, another flat under wife name. Do new owners of flats need to pay stamp duty for getting new leasehold title? If so, is stamp duty base on current market value of flats or from house purchased price?

    Thank you

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    I think you are better off paying for professional advice on that one. The only thing I can add is I did exactly the same thing about 8 years ago. I was advised to put the freehold into a company and grant myself leaseholds. But there was a massive issue about stamp duty. My solicitor and accountant are a bit belt and braces and they believed technically stamp duty would be owed (obviously SDLT was liable on transfer freehold to company but value was below freshold but the leaseholds were the issue). Anyway after much tooing and frowing they devised a scheme along the lines of bare trusts being issued and ownerships temporarily transferred, as you can see I did not really understand it. The important thing is they sought clearance from HMRC. They confirmed without scheme SDLT was liable, they were also happy with scheme and SDLT would not be liable.

    Sorry could not be more help but moral is pay for proper advice

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