Stamp Duty Land Tax

From 1st December 2003 ALL land transactions have been subject to Stamp Duty Land Tax (SDLT).

The Government's stated aim was to bring stamp duty in line with other taxes and they introduced the concept of "process now and check later". In order to do this the Inland Revenue requires completion of a land transaction tax return form which must be lodged with them within 30 days of completion of the transaction. We can assist you with this process but we shall require specific information from you and your co-operation to provide such information.

The Land Transaction return is a lengthy document requiring details of the property and of all parties to the Transfer. In addition the Inland Revenue require details of the National Insurance Number of the first named buyer. We therefore ask you to provide this to us when you first instruct Ashfords in our buyers questionnaire form, together with confirmatory evidence in the form of your National Insurance Card, a pay slip or similar document containing your National Insurance Number. We will complete the form so far as we are able and send it to you for approval, signature and return.

The amount of duty payable on freehold properties has not changed, since 2003, save for recent budget changes, but there may be a slight change in the amount of duty payable on the grant of a new lease. We can advise you on this if necessary.

The fully completed and signed Land Transaction Return must be returned to the Inland Revenue within 30 days of completion of your purchase. Failure to do this will result in you being subject to an immediate tax penalty of £100 for late submission. Failure to submit the form within 90 days from completion will result in you being liable for a further £200 tax penalty. It is the purchaser who is responsible for all Stamp Duty Land Tax and any penalties.

Please note that registration of your ownership of the property cannot be completed until a Certificate of Tax has been issued by the Inland Revenue.

It is therefore vital that the fully completed and signed Return form is submitted to the Inland Revenue within the time limits. Ashfords submit their SDLT forms online, direct with the Inland Revenue to streamline the submission and reduce the potential for errors or lost certificates. If you have any objections to us using this facility, please let us know when you return the client questionnaire to us when you instruct Ashfords.

Important Notes:

• the SDLT forms MUST be received by the Inland Revenue within 30 days of completion;
• failure to file a correctly completed and signed SDLT return within 30 days will result in YOU receiving an automatic penalty of £100;
• failure to file a correctly completed and signed SDLT return within 90 days will result in YOU receiving a FURTHER automatic penalty of £200;
• the SDLT forms are tax returns and MUST be signed by ALL named buyers;
• details of the Total amount paid for the property must be inserted in the SDLT form therefore we require FULL disclosure of ALL monies to be passed to the Seller;
• false information contained within the SDLT form may result in prosecution; and
  
• an SDLT form is a tax return.
  

Ashfords LLP is regulated by the Solicitors Regulation Authority. The information in this note is intended to be general information about English law only and not comprehensive. It is not to be relied on as legal advice nor as an alternative to taking professional advice relating to specific circumstances.