Typically, either the family home is sold and each party buys a new home for themselves, or alternatively, one party stays in the family home and the other party buys a new home (in some cases with the party who retains the home buying out the leaving party’s share).
In the first case, there’s no particular problem for SDLT.
Provided the family home is sold in the three years before or the three years after the new purchase (in each case) then ‘replacement of main residence relief’ applies and the 3% additional residential rate of SDLT on the new home is avoided. If the previous residence is not sold before the purchase then the 3% must be paid but can be claimed back.
In the second case however, there can be a problem, especially if the purchase of the new home by the leaving party occurs before the divorce is finalised. It’s true that the leaving party will have disposed of their interest in the previous main residence by transferring the whole property to their partner, but if they are still married at the time of the new purchase then the spouse or civil partner could still be deemed a joint purchaser and ownership of the family residence will mean that the 3% applies.
There are three routes that can be followed to avoid this: