At present homeowners who pay the higher rate of Stamp Duty Land Tax (SDLT) on purchases of additional property can receive a refund of the three per cent surcharge if they sell their old main residence within three years of the purchase.
However, any such decision would still be at the discretion of HM Revenue and Customs to decide if the circumstances were exceptional.
Financial secretary to the Treasury Jesse Norman MP noted for most people three years was enough time to sell a property.
“However, the government recognises that there will sometimes be exceptional circumstances not in the control of the buyer or seller which mean that a previous main residence cannot be sold within three years,” Norman said.
“If someone purchased a new main residence on or after 1 January 2017, they may be eligible to apply for a refund if they were prevented from selling their previous main residence before the expiry of the three-year time limit owing to exceptional circumstances beyond their control.
“The previous main residence must be sold before HMRC will consider whether the circumstances are exceptional.”
Norman was responding to a written question from Labour MP for Liverpool, Riverside Kim Johnson, who asked whether government had considered suspending the time limit for the repayment of the stamp duty surcharge on second properties where the property sale has been delayed due to cladding and External Wall Survey (EWS1) issues.