Payment of Stamp Duty Land Tax
Both Residential and Commercial Property Owners need to be aware that the Government is reducing the amount of time that is allowed to pay Stamp Duty Land Tax (SDLT) from 1 March 2019
The window for completion of tax returns and payment of SDLT is being cut from 30 days to 14 days with effect from 1st March 2019. This is earlier than the start of the usual tax year so this needs to be accounted for.
The change will be introduced through a Statutory Instrument which is now available for final review (Stamp Duty Land Tax (Administration) (Amendment) Regulations 2018) and will take effect on 1st March 2019. It will reduce the time limit to make a SDLT Return and pay the tax due.
This measure was initially announced in an Autumn Budget by then Chancellor George Osborne and was meant to come into effect in the 2017/18 tax year but was met with strong opposition and subsequently delayed until 2019.
It was claimed by the Government at the time that HMRC needed enough time to “address the issues which arose from the new consultation”.
It was revealed that HMRC received in excess of 85 written responses, mainly from Lawyers who were concerned about the amount of information required in the SDLT return in cases where the purchase of land involved commercial leases or tenancies. It was argued that changes would make it very difficult, in some instances, to comply with the reduced time limit available for these SDLT returns to be made.
However, HMRC has said that “reducing the amount of information required in the return will make compliance with the new timescale significantly easier”.
HMRC is also looking for feedback on a proposed schedule of tenancies which would replace the two schedules of tenancies currently in the Stamp Duty Land Tax Manual.
The comment period on the draft legislation closes on 23rd November 2018.
If you are affected by the new measures, or would like to discuss this in more detail please contact our Tax Partners Steve Crompton or Chris Barrington, see details below:
Partner – Head of Tax
direct dial: 01942 292541
mobile: 07790 840394
direct dial: 01942 292505
mobile: 07730 436070