SDLT on house and barn purchase

[seano]

Hi there

I wonder of anyone can solve this puzzle?

We are quite advanced in a purchase and almost ready to exchange. The purchase consists of a cottage (under one title) and across the highway, a 2 acre field and barn (under another title). The yard around the barn is classed as different from the field. 

The barn was built 11 years ago and was given consent for use by the family for stabling and agricultural storage. The owner then used it as a worksop for his business doing various country services etc. The barn now has consent to be converted to residential.

The vendors want to sell under one contract for both titles to avoid an obvious CGT bull on the barn. I'm ok with this if we can submit a mixed use SDLT return. But this seems not to be straightforward as:

a. the original consent for the barn was for personal use, not commercial - does the 10 year change of use rule apply?

b. if it now has consent for residential does that make it a residential plot even though work hasn't started?

c if it is agricultural land, not physically attached to the cottage, can it be considered garden/grounds?

 

Head scratching here - so any help greatly appreciated.

 

 

[Omnibuswoman]

You are likely to need the assistance of a solicitor well versed in property and tax law for this. If a mistake is made and you over or underpay tax, getting it put right can be costly.

[Temp]

I'm not sure their plan to avoid cgt works as it's hard to argue the barn is part of their Principle Private Residence if its a seperate title but that's their problem. Are they proposing to merge the titles at the land registry before/at sale to you? Then you split them again?  

 

I think you need to look at the most recent consent on the barn. If its for change of use or conversion to a dwelling, then it will say its from ??? to a dwelling. It remains ??? until the consent is implemented. I suspect ??? Is not Residential or Planning Permission wouldn't be required for change of use or conversion. 

 

 

 

 

 

Edited March 9, 2023 by Temp

[Mr Punter]

There is not a great deal of difference in the rates.  Can you see which one is cheapest and put it through?

[McHanks]

Hi Seano, can I ask what you ended up doing for your purchase? I have a similar scenario need to decide what is appropriate for SDLT...