Stamp Duty in a Disadvantaged Area

Badger_Lady · 20 February 2008 at 5:15PM

I bought my house at the end of last September for £145,000 and therefore paid £1,450 in stamp duty.

When I was talking to my yummy neighbour last night, he said "Wasn't it great, not having to pay stamp duty here?" (he bought his identical house last summer).

I asked what he meant and he said "Well, this is classed as a deprived area, so you don't have to pay any stamp duty unless you pay over £150,000."

Well, I got straight onto the 'net and found this link: http://www.hmrc.gov.uk/so/dar/dar-relief.htm - sure enough, my postcode qualifies for this discount.

So I've just called my conveyencer pointing this out and asked them whether I can get my cash refunded... they've promised to call me back...

Anyone had any experience of this / knows what will happen / finds themselves in a similar position?

Doozergirl · 20 February 2008 at 5:17PM

We've had people on here who have claimed their money back. If the solicitor doesn't know the area, they often just include the SDLT in their bill. We've had it before but knew that it fell into a disadvantaged area (only because we used to live there, otherwise I'd probably still be none the wiser!)

I don't think it will be a problem for you

Jorgan_2 · 20 February 2008 at 5:18PM

I got my money back with interest. I went via my solicitor & it took about a month to get the money back.

Richard_Webster · 20 February 2008 at 5:22PM

I know where the disadvantaged areas are in Hampshire and if I am acting out of area I can easily do a postcode search on the HMRC website so I really don't understand why the conveyancer didn't check as a matter of routine.

Badger_Lady · 20 February 2008 at 5:26PM

Woo-hoo! Thanks guys, that's really positive - I could really do with that cash to get me on track with the decorating etc. The move made me debt-free anyway, so I'm chuffed to pieces with the prospect of actually having money for the first time in my life!

The conveyencing was all a bit of a mess in the end - my solicitor left the firm half-way through and a handful of secretaries picked up bits and pieces for me, signed off by another partner. I was also buying well outside their normal area (because I was relocating from their area and they were managing my sale there). So I guess a mistake like this was entirely possible, particularly since their area is far from disadvantaged.

Jorgan, how much interest were you able to claim and how did you go about doing so?

Jorgan_2 · 20 February 2008 at 5:42PM

Richard_Webster wrote: »

I know where the disadvantaged areas are in Hampshire and if I am acting out of area I can easily do a postcode search on the HMRC website so I really don't understand why the conveyancer didn't check as a matter of routine.

I checked the HMRC website, as did my solicitor. When I queried it with the HMRC they said I wasn't in an exempt area. The person running the residents association was adamant that the area was exempt and the postcode was irrelevant as it goes on the electoral ward the property was in. He was right and I got my money back. All this was nearly six years ago, I don't know if anything has changed in that time.

Jorgan_2 · 20 February 2008 at 5:48PM

Badger_Lady wrote: »

Jorgan, how much interest were you able to claim and how did you go about doing so?

I didn't actually claim for any interest, I received a cheque from my solicitor for my stamp duty & the HMRC had just added the interest. I've got a feeling it was about £50, the mistake wasn't realised for about six months.

Badger_Lady · 20 February 2008 at 5:49PM

Jorgan wrote: »

I didn't actually claim for any interest, I received a cheque from my solicitor for my stamp duty & the HMRC had just added the interest. I've got a feeling it was about £50, the mistake wasn't realised for about six months.

Fantastic - mine is getting on for that length of time now, so maybe it'll round up to close £1,500 :T :j

Richard_Webster · 20 February 2008 at 7:11PM

The electoral ward as constituted on 7 May 1998 in England and 1 April 1998 in Wales is what is critical. The boundaries may have changed since then.

Jorgan, was yours a new build?

The HMRC website does make the point that particularly with new builds the postcodes may not be clear or available. I suppose it would be possible for the post office to allocate a postcode for new houses which had previously only applied to properties outside a disadvantaged ward but the new houses were just the other side of the boundary?

You can download lists of the wards from the HMRC website so if I am acting for someone out of area, once I have established which local authority district they are in it is easy to see if there are any disadvantaged areas in that district. If there are I do the postcode search at HMRC. Obviously if a client thought it might be disadvantaged because a local had told him, I would ask what ward they thought they were in, and then check directly with the Council.

Jorgan_2 · 20 February 2008 at 8:35PM

Richard_Webster wrote: »

Jorgan, was yours a new build?

The house was about 18 months old, so it ties in with what you posted.

wildt · 21 February 2008 at 12:03AM

I've just typed the postcode of the house we are buying into the search on that website and it says it is a qualifying area. But the offer they have accepted off us is £153,00! Does this mean we have to pay the full stamp duty or do you get any kind of discount? It is a leasehold property, if that matters!

We should of offered £149,995!!:mad:

Stamp Duty in a Disadvantaged Area

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