Following a change of heart by the government Granny Flats, as they are commonly known, will be exempt from Stamp Duty Land Tax (SDLT). Originally, homeowners with self-contained accommodation designed to house elderly relatives faced being classed as having a second property under the recent changes to SDLT rules. Sir Eric Pickles, the former Communities Secretary, said “It is a great victory for common sense. Those who convert accommodation to offer a home to a relative, sometimes elderly, sometimes with special needs, should not be penalised”.
The change will mean a Granny Flat, when purchased alongside a main residence in the same transaction, will not be subject to the higher rates of SDLT that second homes are. Instead the standard rates of SDLT will apply to the entire transaction value.
If you have any questions about how stamp duty might affect your own plans to purchase a Granny Flat, or any other property, please contact partner, Gary Baker.