Stamp Duty Land Tax (“SDLT”) – HMRC’s 3 year Repayment Extension

Currently in the UK, buyers must pay a 3% SDLT surcharge if they purchase a residential dwelling and they own more than one dwelling. Alternatively, buyers are granted the opportunity to claim for a refund of this surcharged SDLT if they purchase a new property, and then proceed to sell their previous main dwelling within a three-year period.

The government have however recognised that as a direct consequence of the restrictions that have been placed on the housing market this year, that this has prevented individuals in being able to sell their previous main property within the required three-year time period. As a result, HMRC have now published an ‘exceptional circumstances’ update, which may assist some buyers in claiming their SDLT refund.

To be eligible to apply for a SDLT refund under this extension you must have purchased your home on or after 1st January 2017 and were unable to sell your previous home within three years due to reasons outside of your control, for example:

  • the impact of coronavirus (COVID-19) has prevented the sale;
  • an action taken by a public authority has prevented the sale.

However, it must be noted that HMRC emphasise that as soon as the inhibitor to the property sale is no longer active, the previous dwelling residence must be sold in order to be able to claim for a refund. Further, it is then once the property has been sold that HMRC will consider whether the circumstances were exceptional enough to constitute an extension. HMRC have advised that each case will be considered on its own merits.

For further guidance on the principles and examples of circumstances where a SDLT refund may be issued please see the link below: https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm09807

Additionally, if you believe that you may be eligible for a SDLT refund please follow the link below in order to begin your application: https://www.gov.uk/guidance/stamp-duty-land-tax-online-and-paper-returns

If you have any queries at all on any aspect of the stamp duty land tax provisions or you require specialist advice on how this may impact you in relation to a property purchase, please contact us at BTMK at info@btmk.co.uk or by telephone (24/7, local rate) on 03300 585 222. We have some of the most experienced conveyancing solicitors and lawyers in the region working in our team and we pride ourselves on conveyancing by communication.

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