SDLT ADVICE
Stamp Duty Land Tax (“SDLT”)
Stamp Duty Land Tax (“SDLT”) was introduced in 2003 to replace Stamp Duty and is chargeable on all transactions for Purchases of Land above a certain value.
We offer slightly different advice for SDLT as it applies to Commercial Property transactions and Residential Property transactions. Please click the links which are appropriate to you.
SDLT PROPERTY RESIDENTIAL
Stamp Duty Land Tax (“SDLT”)
Stamp Duty Land Tax (“SDLT”) was introduced in 2003 to replace Stamp Duty and is chargeable on all transactions for Purchases of Land above a certain value.
SDLT1 Form
In theory the Tax Return SDLT 1 should be completed by the Client (the Tax Payer) who must sign a Declaration like any other Tax return. In practice WGS as Solicitors will complete most of it. Why? Because Solicitors are answerable to Mortgage Lenders and have a duty to ensure Registration of Title and thus they cannot be left in a situation where a Return is not completed, Tax is not paid, a Tax Paid Certificate is not returned by the Revenue and we thus we cannot register your title and the Mortgage. This form must be signed by the Buyer. It cannot be signed by your solicitor save where you have given a formal Power of Attorney to your solicitor to sign all other documents. At WGS Solicitors we will assist you by completing the bulk of the form but it must be signed you you and returned by us promptly as the form and stamp duty payable must reach the Inland Revenue within 28 days of completion. Otherwise penalties and interest are charged.
Payment of SDLT
Before 2003 some Buyers sought to avoid payment of the old Stamp Duty. This is not possible now. The amount payable varies according to the latest Budget and you should visit the HMRC SDLT on-line calculator to assess the stamp duty payable on a property which you might wish to buy. The amount payable varies according to rates imposed in the latest Budget. Increasing House prices make SDLT an unpopular tax whilst HMRC find the tax very effective as it costs them almost nothing to collect. There are schemes offered by sophisticated tax advisers which seek to mitigate and even avoid payment of SDLT but HMRC attack these as quickly as they are promoted. SDLT is also used by HMRC to attack purchasers who buy properties through companies to minimise their tax liabilities and SDLT is charged on a higher rate to many Companies known as Non Natural Persons (NNP’s). The Tax regime for NNP’s is becoming more aggressive and the rate of SDLT charged to NNP’s buying residential properties is much higher than to individuals. Clients buying some Commercial Properties may pay SDLT at different rates from residential properties.
Advice on SDLT
WGS Partners in the property department can advise you about these variable rates and the SDLT regime generally.