How to get a Stamp Duty Refund
Stamp duty tax is complicated. And there are a number of common reasons that lead to it being miscalculated and overpaid. So we've asked Cornerstone Tax Advisors to explain what can go wrong, how to work out if you have a claim and how to go about getting a stamp duty refund.
January 25, 2022
3 minute read
Stamp Duty has been a hotter topic than normal over the past eighteen months. Homebuyers have raced to take advantage of the brief tax holiday. But how much does the average U.K. taxpayer actually know about Stamp Duty, beyond that it’s a tax you pay when you buy a property? That, according to the stamp duty specialists at Cornerstone Tax Advisors, is at the root of a very real issue. They explain how the calculations can often be incorrect and how to get a stamp duty refund.
The Limits of HMRC’s Stamp Duty Calculator
Most people’s acquaintance with stamp duty is limited to the calculator on HMRCs website. It allows you to work out how much you owe. But the problem with that calculator is that it covers only the most basic parameters. It is suitable for a straightforward residential purchase of a single home or a single commercial property. Once your transaction strays outside those parameters, things get a little more complicated. So it’s no surprise the calculation can be wrong.
Common errors and reasons for applying for a Stamp Duty refund
- Additional granny annexe or other self-contained accommodation
- Incorrect payment of the stamp duty surcharge
- Uninhabitable House
- Part Residential Part Business Premises
- More than 6 dwellings
- Connected Party Purchases or Transfers
How can I claim a Stamp Duty refund
When a Stamp Duty Return is completed (usually by a solicitor) it is submitted as a personal tax return in your name. As SDLT is self-assessed tax, this means that the responsibility for its payment and the amount payable is entirely that of the purchaser as a private individual. If it’s wrong, that means the onus lies on you to rectify it.
Of course, if it turns out that you’ve underpaid your Stamp Duty, you can be fairly certain that HMRC will be in touch. If however you’ve overpaid, then it’s down to you to investigate and amend if necessary. For example, your solicitor may have failed to account for some relief, exemption or exception that would be applicable (of which there are 49 in total to date) .
Typically, you have a period of one year in which to submit an amendment to an SDLT return. In some cases this may be extended up to four years. In order to consider a refund, HMRC will require a detailed explanation of why the original assessment was incorrect, as well as a fully completed new return to replace it.
I’m not sure if I do have a claim – how can I check?
The best way to go about obtaining a refund of overpaid SDLT is to engage the services of a specialist adviser. Solicitors – who are often left to deal with Stamp Duty on their own – cannot be expected to be tax experts who are aware of every nuance of the Stamp Duty legislation. There are constant updates to the tax that could spell a lower Stamp Duty bill and these can often be missed.
A dedicated tax adviser will be able to quickly assess the transaction and determine whether a claim exists, and then pursue that claim quickly and efficiently on your behalf.
At SDLT Refunds, we offer a free, no-obligation initial assessment to determine whether a refund is due. If it is, we will engage with HMRC on your behalf. We will carry out all the necessary work and communications, and work with your legal and financial advisers as necessary. We also don’t charge a fee unless and until we’ve obtained you your refund from HMRC.
Where do I start?
Cornerstone tax are experts in claiming stamp duty refunds. You can see if you are eligible for a Stamp Duty Land Tax refund from HMRC, if you have purchased UK property in the last 4 years. They will assess your case within 48 hours and can assist you with making the claim.
Step-by-step guide to buying a home
How much is stamp duty and when do I pay?
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