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When is a first time buyer a first time buyer?

brugen
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Joined: November 9th, 2016, 5:21 am

When is a first time buyer a first time buyer?

#236550

Postby brugen » July 14th, 2019, 10:01 am

My son and his girlfriend live in rented accommodation and are looking to purchase their first house together. My son has never owned a house but his girlfriend has bought a house for her mother which only her mother lives in. If that house is sold there will be no capital gains tax to pay even though it is not the girfriend's primary residence as the house is used by "his or his wife’s mother who, whether or not incapacitated, is either widowed, or living apart from her husband, or a single woman in consequence of dissolution or annulment of marriage." according to the Capital Gains Tax handbook.
The question is - would the girlfriend be treated as a first time buyer when it comes to assessing whether stamp duty is payable or not on the house they plan to buy together?
Thanks

PinkDalek
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Re: When is a first time buyer a first time buyer?

#236566

Postby PinkDalek » July 14th, 2019, 11:58 am

HMRC’s Capital Gains Manual mentions your extract here https://www.gov.uk/hmrc-internal-manual ... al/cg65570. Is that where you were looking? If so, are you aware of the main conditions for dependent relative relief here https://www.gov.uk/hmrc-internal-manual ... al/cg65550?

In addition to the relief which may be due on the disposal of a person’s own residence relief may also be due on the disposal of a residence which has been provided for a dependent relative. But this relief is not available in respect of

any residence acquired after 5 April 1988

or

any residence acquired before that date unless the conditions for relief were met by that date.


I haven’t checked but I doubt there’s a similar exemption for SDLT purposes, in that dependent relative relief was abolished for purchases after 5 April 1988 and it is unlikely such a concession would have been reintroduced for SDLT.

You could check here https://assets.publishing.service.gov.u ... e_note.pdf (which I might do as well, after the World Cup Final).

monabri
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Re: When is a first time buyer a first time buyer?

#236608

Postby monabri » July 14th, 2019, 4:40 pm

brugen wrote:My son and his girlfriend live in rented accommodation and are looking to purchase their first house together. My son has never owned a house but his girlfriend has bought a house for her mother which only her mother lives in. If that house is sold there will be no capital gains tax to pay even though it is not the girfriend's primary residence as the house is used by "his or his wife’s mother who, whether or not incapacitated, is either widowed, or living apart from her husband, or a single woman in consequence of dissolution or annulment of marriage." according to the Capital Gains Tax handbook.
The question is - would the girlfriend be treated as a first time buyer when it comes to assessing whether stamp duty is payable or not on the house they plan to buy together?
Thanks


So, doesn't that sort of indicate that next house will be her second house? She owns house #1...she could take possession of it.

PinkDalek
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Re: When is a first time buyer a first time buyer?

#236610

Postby PinkDalek » July 14th, 2019, 4:43 pm

That’s the point of the question!


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