Granny Flat Stamp Duty U Turn

Granny Flat Stamp Duty U-turn.

The government has confirmed that it has revised how the additional 3% stamp duty land tax will be applied to property purchases that include a separate annexe or "granny flat".

When the additional 3% stamp duty land tax was introduced for second homes and investment properties, granny flats, were caught in the same as that part of any new property would not be treated as your main residence.

However, the government has now clarified this to ensure fairness with the 3% additional stamp duty will now only apply to annexes and granny flats where they are a separate "parcel" i.e. a separate deed.

In summary:

• A separate registered title deed enabling the annex to be sold in its own right
• If it is worth £40,000 or more
• If it has its own front door

Comment

It makes total sense that if this is a separate property with its own council tax liability then of course stamp duty land tax should be payable if it is worth more than £40,000. This clarification from the government is a sensible move to keep paperwork to a minimum.