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Where Taxpayers and Advisers Meet

SDLT query please

Ndavis
Posts:4
Joined:Sat Apr 29, 2017 6:36 pm
SDLT query please

Postby Ndavis » Sat Apr 29, 2017 6:55 pm

Hi
Sorry, but I have a question about the stamp duty rules, if I may?

I sold my main residence in April 2016 & have been living in rented accommodation since before then (due to a relationship breakup in which my ex stayed in the property until sold). In October 2016 I purchased a buy to let with some of the proceeds of my house sale whilst I decided on where I wanted to settle. I am now looking to purchase a property to live in. When I bought the buy to let I paid the higher rate of stamp duty, as advised by my solicitor. I queried this at the time as I didn't own another property at that time, but was advised that this was correct as it would not be my main residence. I was advised that I would pay the lower rate when I came to buy my residence.

I have now been advised that I have to pay the higher rate on the property I am looking to purchase because I own a property. Is this correct? Surely I should pay the lower rate on one of these 2 properties, but which one? I've also been advised that I only have 6 months to claim a refund if I paid incorrectly in October, which means I need to do this next week. I've tried checking the gov.uk website, but can't see the information needed to answer this myself.

Any help would be gratefully received.

SDLT Geek
Posts:232
Joined:Sun Apr 30, 2017 5:45 pm

Re: SDLT query please

Postby SDLT Geek » Sun Apr 30, 2017 5:55 pm

It sounds as if pretty much everything you have been told is wrong! Based on what you say:

1. You should not have paid the higher rates of stamp duty land tax on your October 2016 purchase because at the point of completion it was the only property you owned.

2. You should not pay the higher rates of SDLT on your upcoming purchase because the exception from the higher rates for the purchase of a replacement main residence should apply to you.

3. You have a little over 12 months from October 2016 to claim back the SDLT paid in error.

You will find some reasonably clear guidance from HMRC here: https://www.gov.uk/government/publicati ... properties and more information here: http://www.zoopla.co.uk/discover/buying ... ZVwZEud.97

maths
Posts:8507
Joined:Wed Aug 06, 2008 3:25 pm

Re: SDLT query please

Postby maths » Sun Apr 30, 2017 6:00 pm

If you sold your residence (in which you/ex lived) prior to buying the buy to let and therefore you only owned one property (ie the buy to let) then the 3% SDLT charge should not have applied to your purchase.By "buying" means "completion" not "exchange".

If you are now buying a property in which to live (whilst still owning the buy to let) then you will own two properties (in principle triggering the 3% charge).
However, it appears that the 3% will not apply as you will be replacing your previous residence with your new one.

I assume you owned your former residence.

I assume that you did not "exchange" on the sale of your residence before 26 November 2015.

Ndavis
Posts:4
Joined:Sat Apr 29, 2017 6:36 pm

Re: SDLT query please

Postby Ndavis » Tue May 02, 2017 8:27 pm

Thank you for the advise. Much appreciated. This is good news indeed, on all 3 points. :D

Ndavis
Posts:4
Joined:Sat Apr 29, 2017 6:36 pm

Re: SDLT query please

Postby Ndavis » Tue May 02, 2017 8:30 pm

I think I'll be changing solicitors!!

maths
Posts:8507
Joined:Wed Aug 06, 2008 3:25 pm

Re: SDLT query please

Postby maths » Tue May 02, 2017 10:37 pm

Check info here:

https://www.gov.uk/guidance/stamp-duty- ... ne-returns

I suggest you contact the solicitors. Tell them you have taken advice and that they were incorrect with respect to their advice re the 3% SDLT charge.

Tell them that you now require that they reclaim the amount paid on your behalf and that you require them to pay interest on the amount.

Tell them that if they fail to seek a reclaim asap you intent to notify the Law Society of their alleged negligence.


Ndavis
Posts:4
Joined:Sat Apr 29, 2017 6:36 pm

Re: SDLT query please

Postby Ndavis » Thu May 04, 2017 11:27 am

Thanks for the advise.

Having a bit of a battle with the solicitors at the moment. They now agree that I am entitled to a refund on the amount paid in Ictober 2016 however they are keeping to a stance that I need to make the refund claim, not them.

I have tried ringing the claims line but it states that I need the payment details which I don't have as I didn't pay them directly, but rather through the solicitors.

Not impressed at all. Still, having it confirmed that I am correct makes my position stronger, so that you for that. Much appreciated

maths
Posts:8507
Joined:Wed Aug 06, 2008 3:25 pm

Re: SDLT query please

Postby maths » Thu May 04, 2017 3:14 pm

Not sure what you have actually done so far but you could write to the senior partner and cc the managing partner (registered post) something along the lines as set out below.

Or you could telephone Birmingham Stamp Office and explain the position; they may arrange for repayment based on your call.

Dear Mr...

One of your partners Mr.... acted on my behalf with respect to a recent residential acquisition, namely, [insert address].

Mr... advised me that I was required to pay the 3% SDLT charge and indeed charged for so doing. I questioned it at the time but he insisted. I have since been informed that this was incorrect advice and Mr.. has accepted that the 3% should not have been paid. However, he is now refusing to apply for the requisite refund on my behalf.

This is unacceptable and completely unprofessional.

Before taking further action I request that your firm now applies on my behalf to obtain the requisite refund.

I look forward to your response asap.


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