Stamp Duty Planning and SRA

elletee

Hi

In October 2011 I purchased my flat, during the purchase my solicitors recommeneded a legal stamp duty Planning scheme where I didn't pay the Stamp Duty and instead paid a smaller amount to a different solicitor to arrange thinngs. All went through without a problem.

Now in December I received a letter from HM Revs and Customs saying that the original Solicitor I was using has stopped trading after action by the Solicitors Regulation Authority, and they're now taking a review of the SDLT returns submitted.

The letter said I didn't have to do anything and they'd be in touch in the next few weeks if they needed to check anything.

I've been dreading the post every day now ... am I right to be worried?? Can they claim back something from over 2 years ago (I'm guessing yes!). I phoned them today and they were worse than useless, saying there was nothing on the file and I'd have to write to them for details (Which 1 is archaic and 2 , why tell me I can phone on the letter??).

Thanks

kingstreet

You'll have to wait for the response.

Worst case scenario, you'll have to pay the stamp duty and any penalties levied by HMRC.

Seabee42

I am aware rich foreigners got round stamp duty in the past by using a company and selling the company rather than the property.

The practise of "avoiding" legal tax is clearly not legal. I moved house and had to pay 9k of tax I am not sympathetic that other people think the tax should not apply to them.

elletee

Seabee42 wrote: »

I am aware rich foreigners got round stamp duty in the past by using a company and selling the company rather than the property.

The practise of "avoiding" legal tax is clearly not legal. I moved house and had to pay 9k of tax I am not sympathetic that other people think the tax should not apply to them.

I wasn't aware I was asking for your sympathy. If you don't have anything useful to say, why feel you have the right to criticise?

amnblog

Speak to your solicitor and establish exactly what is happening.

Tax planning schemes are often covered by insurance to protect you against future issues.

Yorkie1

amnblog wrote: »

Speak to your solicitor and establish exactly what is happening.

Tax planning schemes are often covered by insurance to protect you against future issues.

OP's solicitor has ceased trading after SRA action; OP might want to check where their file went to upon that intervention:
http://www.sra.org.uk/consumers/problems/solicitor-closed-down/intervened-firms.page

Otherwise, it's as others have already said.

More info on the SRA's warning to law firms here about avoidance schemes:
http://www.sra.org.uk/solicitors/code-of-conduct/guidance/warning-notices/Stamp-duty-land-tax-schemes--Warning-notice.page

Thrugelmir

elletee wrote: »

I phoned them today and they were worse than useless,

The inquiry is most likely focussing on the solicitors and their activities. Doesn't make them useless because they haven't got round to your individual case yet. Totally the opposite. By giving you due notice. The matter can be concluded at their leisure with no time limit. If the activity is ultimately deemed to amount to evasion. You'll be liable. At least you've time to save and put the money aside.

Seabee42

elletee wrote: »

I wasn't aware I was asking for your sympathy. If you don't have anything useful to say, why feel you have the right to criticise?

I would hope you had the stamp duty when you purchased the flat and since you did not pay it I would presume you still have the money invested. Otherwise as others have said start saving.

Clearly people on here cannot advise you on how to avoid paying tax. What did you expect? At the time you knew a tax was due and did not pay it!

E._Tenebris_Lux

If you do have to pay the stamp duty, you may wish to look into bringing a professional negligence claim against the solicitors which advised you on the avoidance scheme.

Even if the firm has been the subject of an intervention, it can still be liable for historic negligent advice and this will in any event be covered by the firm's professional indemnity insurance.

So it might be worth speaking to a solicitor specialising in professional negligence claims (or the CAB / Law Centre if paying fees would be difficult) and getting them to notify the Intervention Agent which has taken over control of the firm.