Buying a new and selling existing main residence to ltd company?

Buying a new and selling existing main residence to ltd company?

9:10 AM, 30th December 2020, About 3 years ago 2

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Hello everyone, I am in the process of purchasing a new residential property and transferring my current residential property to my LTD company.

Will I be liable to pay stamp duty on my current property as well as the new residential purchase?

I was informed that I can claim a stamp duty exemption on my current residential property when I transfer it to my LTD company or I don’t pay stamp duty on my new residential providing I carry out a simultaneous completion.

Thank you 🙂


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Neil Patterson

9:18 AM, 30th December 2020, About 3 years ago

Hi Ricki,
If you are replacing an old main residence with a new simultaneously there will be no additional stamp duty surcharge or if it is not simultaneous and the old main residence is sold within 3 years you will pay the additional amount and can apply for a refund.

If you sell a property to a Ltd co without s 162 incorporation relief there will be a SDLT and CGT liability. However, a main residence is CGT free assuming it has always been so or if not receive PPR relief.

Please see our tax planning resource page >>

Mervin SX

13:36 PM, 3rd January 2021, About 3 years ago

Hi Ricki,

Just elaborating on what Neil has said above:

1 - You pay stamp duty on all purchases above £125K. There are exemptions for first time buyers and for sales completed before 31st March 2021.

2 - You also pay 'additional' stamp duty on all second home purchases. All LTD company purchases attract the 'additional' stamp duty. This is 3% over the current relevant rates.

So, taking the above two points into consideration:

IF you simultaneously sell your current residence to a LTD company and buy a new replacement main residence - you will pay the 'additional' rate stamp duty for the LTD company transaction and you will pay normal rate stamp duty for your new replacement main residence.

IF the two transactions are not simultaneous, then you will pay 'additional' rate stamp duty for your replacement main residence as well as for the LTD company transaction. But when you complete your LTD company transaction and if this is within 3 years of the replacement main residence purchase, then you can claim back a refund of the 'additional' rate you paid for the replacement main residence.

Hope this helps?

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