PII – are you confident that your firm is calculating SDLT correctly?
Why wouldn’t you be? Stamp Duty Land Tax has been in place now for nearly two decades, and it’s just the same as the old Stamp Duty, isn’t it?
Plus, HMRC provide a simple calculator on their website which is easy to use and the vast majority of transactions are quit straightforward and ‘normal’ meaning that reliefs and exemptions are a rarity you don’t need to worry about.
Well, have we got some news for you.
First of all, let’s talk about reliefs, exemptions and exceptions. Currently there are 49 in relation to SDLT, and that’s a number which can always grow. Those reliefs cover circumstances from a property being uninhabitable (and the quagmire of defining that status) to having land which is used for commercial purposes, having a separate dwelling as part of it (and the whole definitional quagmire that can cause) and various other assorted circumstances which might apply more often than you’d expect.
Let’s talk about the basics of SDLT itself. The slice system now in operation. The surcharges which currently apply for additional residential properties (Buy to Lets and Holiday homes) or non-UK residents purchasing in the U.K. and how even that apparently straightforward definition can catch out people you might not expect.
Let’s think of all the times that various governments have tweaked and massaged the SDLT rules in order to try to achieve some policy goal or other – the introduction of Multiple Dwellings Relief to encourage more BTL investment, the introduction of the Higher Rate on Additional Dwellings to try to discourage BTL investment and 2020’s ‘Holiday’ designed to stimulate a market which had stalled in the face of a global pandemic and the associated lockdowns.
Let’s remember that SDLT is not a tax on documents like the old Stamp Duty but a personal, self-assessed tax which attaches to the buyer and leaves them with full responsibility for its prompt and accurate payment.
How many of your ‘normal’ transactions might involve a buyer who can ill afford the potentially thousands of pounds they might erroneously pay in SDLT because you missed a relief or exemption which applied to their property?
Let’s talk about that HMRC calculator, and the fact that it isn’t nuanced enough to catch so many of these reliefs and exemptions. The fact that HMRC itself was quoted in a national newspaper saying the calculator was intended merely ‘as a guide’.
The fact that so many firms in the last eighteen months have seen rising numbers of claims against them from clients for missed MDR and other reliefs on purchases, and the subsequent hit to their firm’s reputation and PII premiums.
In the last quarter alone, PII costs rose on average by over 30%. How much more might that number rise for your firm if an error is made?
Compass is designed to solve this problem for you.
Intuitive, comprehensive and built to integrate easily into any existing case management system. It’s also been built with the latest CQS guidelines on SDLT in mind, ensuring that you will be fully compliant and able to produce the necessary audit trails and evidence of appropriate checks with no additional effort required.
The SRA’s Code of Conduct states, at Clause 4.3 that fee earners ‘are required to carry out their role and keep their professional knowledge and skills…up to date.’ A Compass Subscription is a cheaper, faster and easier solution to this with regards to SDLT than training your conveyancers to be tax advisers as well.
As you can see, if you want to make sure your stamp duty is right first time, every time, and that you make every saving to which you’re entitled, Compass isn’t just the best option – it’s the only option!
Call or email us today!
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