First-time buyers are in the news right now with Chancellor Philip Hammond’s focus on giving newcomers to property owning a tax break by exempting them from paying Stamp Duty Land Tax on transactions worth up to £300,000.
But how do you know for sure that you qualify as a first-time buyer and so can benefit from the Stamp Duty exemption?
The Treasury, which levies Stamp Duty Land Tax on behalf of the Government, is clear on its definition: A first-time buyer is someone who has never owned freehold or leasehold interest in a dwelling before and who is purchasing their only or main residence.
If you have been left a share or whole of a residence in a will, you are not a first-time buyer.
If you own residential property anywhere else in the world, you are not a first-time buyer.
If you own a static caravan, you are not a first-time buyer.
If you have never bought before and are buying in joint names with another person who has previously owned a property, then you are not a first-time buyer in the eyes of the Treasury.
If you have participated in a shared ownership scheme with a housing association and are now buying on your own, you are not a first-time buyer.
If you are purchasing a property as a buy-to-let, even if it’s the first time you’ve bought, you are not a first-time buyer.
If you claim you are a first-time buyer when you know that you are not, you may be committing fraud and could face a fine while also having to pay the outstanding tax.
Your solicitor will apply for the exemption to Stamp Duty Land Tax when completing your conveyancing to purchase a property. He or she will be asked to fill in a code that confirms the buyers have never purchased a dwelling before.
Read our detailed Q&A on Stamp Duty and first-time buyers for more information.
If you’re a first-time buyer, check out Homeward Legal’s comprehensive First-Time Buyers’ Hub where all your questions about purchasing for the very first time are covered in detail.