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Buying a house with an annex?

Buying a house with an annex?

Stamp Duty Land Tax (SDLT) is a fee charged when buying a property or land over a certain price in England and Northern Ireland.

The Government website ( states that the tax is different if the property or land is in:

  • Scotland – where you would pay Land and Buildings Transaction Tax
  • Wales – where you would pay Lane Transaction Tax if the sale was completed on or after 1 April 2018

The current SDLT threshold is £125,000 for residential properties and £150,000 for non-residential land and properties.

There are different rules if you’re buying your first home. You get a discount (relief) that means you pay less or no tax if:

  • you complete your purchase on or after 22 November 2017
  • the purchase price is £500,000 or less
  • you, and anyone else you’re buying with, are first-time buyers

Over recent months there has been issues when buying a property with an annex. If you are buying a property with an annex you need to let us know as you could be paying the wrong Stamp Duty levy.

The HMRC Guidelines state that:

A building or part of a building can still count as a dwelling if it is suitable to be used as such. This may be the case even if it is not currently being used or intended to be used in the future as a separate dwelling.

In the case of granny flat-style annexes, the house and granny flat will probably be considered as two separate dwellings if:

  • Each part has its own front door. In the case of the granny flat, this may come off a commonly used part such as an entry hall, but in either case, you would not have to pass through a private living area of the other part to get to it.
  • Each part is self-contained and has all the elements that you would expect for a dwelling, such as sleeping, washing and cooking areas and facilities.

We have updated some of our internal processes to ensure this question is asked when you use our conveyancing services and we are able to refer you to a SDLT Specialist Tax Advisor to ensure that you receive the appropriate advice.

To contact our Conveyancing Team please call 0800 160 10 10.

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