Stamp Duty Land Tax – Can you afford not to get it right?

by Aneta Williams, Senior Tax Associate

For more information on how RRL can help with SDLT, please contact Tax Partner Steve Maggs, on 01872 276116 / 01736 339322 or steve.maggs@rrlcornwall.co.uk.

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The tax landscape is ever changing and has become ever more complex, and this is particularly so for stamp duty land tax (SDLT).

SDLT was once a relatively straight forward part of the conveyancing process, but this is certainly no longer the case.

A charge to SDLT arises where:

  • There is a land transaction;
  • It involves land within the UK; and
  • It is not within one of the exemptions from charge.

The calculation of the charge is based on the chargeable consideration, with the percentage depending on whether a property is residential or non-residential.

The tax has become increasingly complex in recent times. The following are typical problem areas we are asked by clients (and conveyancing solicitors) to advise on:

  • The availability of Multiple Dwellings Relief;
  • Whether a property is ‘residential’ or ‘non-residential’ – particularly in situations where ‘mixed use’ can be argued; and
  • Whether the ‘additional property surcharge’ applies to a transaction;

The increased SDLT complexity has meant that there are increasing risks and opportunities to be considered.

Whether Multiple Dwellings Relief applies to a purchase, whether a property is considered to be a ‘residential’ or ‘non-residential’ property purchase, and whether or not the additional property surcharge applies to a purchase can make a huge difference to the overall SDLT liability.

It really is worth seeking experienced advice to ensure that you are paying the correct amount of SDLT on a purchase, and not paying more than you should be.

The fact that we have a tax team made up of multiple Chartered Tax Advisers enables us to offer experienced, high-level SDLT advice to ensure that risks are managed, and opportunities not missed. Providing you with peace of mind that the SDLT position is taken care of.

We advise our clients, either during the purchase price or after their purchase has completed (where we have not been previously involved) to claim a refund of SDLT where they have overpaid SDLT.

By way of a recent example, we acted for one of our clients where they had approached us for advice after they had completed the purchase of their new home. We provided advice on the availability of ‘multiple dwellings relief’ and liaised with HM Revenue & Customs to obtain a £32,500 tax repayment.

If you are currently going through, about to embark on, or have recently completed (congratulations!) the purchase process, please get in touch.

Many SDLT queries also have other tax angles to them, which again, we are uniquely well placed to deal with in Cornwall.

 

This publication has been prepared by RRL LLP. It is to be treated as a general guide only and is not intended to be a comprehensive statement of the law or represent specific tax advice. No liability is accepted for the opinions it contains, or for any errors or omissions. All rights reserved.