Advice - Solicitors Error Stamp Duty

mckain

Evening,

I agreed a fee for a new property back in January this year which will be my main house (I currently rent out a flat i own). Damp issues in the new property resulted in a delay signing the contract as we wanted quotes etc on how much it would cost to resolve the damp issues.

I did not know until yesterday (doh) that from 1st April there will be an additional 3% dwelling surcharge for stamp duty on a second property. I was not advised by my solicitor about this and feel if I did, contract would have been signed before the 1st April.

Does anybody know if I can complain about this or where do I stand, I doubt there is much I can do, any advice would be appreciated.

davidmcn

Did your solicitor know this would be an additional property for you?

Even if they did, I wouldn't think it part of the normal remit of your solicitor to advise you of the tax consequences of buying/selling properties at particular times - and you'd also have to prove that it actually would have completed before 1 April. It sounds like you had good reasons for delaying - would you really have bought blind to the damp issues just to save on the stamp duty?

Derboy

The stamp duty increase has been widely documented in the news after the last budget. Your solicitor may have assumed that you were already aware. You've no come back here.

A better conveyancer may have made a point of letting you know but they can't be held liable for your lack of knowledge on this.

mckain

I'm pretty sure it would have been complete as original move in date should have been tomorrow.

I am not aware that solicitor knows (was never asked), would they receive copy of forms received from bank?

Fees on the letter from solicitor in January stated cheaper stamp duty costs.

alchemist.1

Oh dear. Write a letter of complaint then address it to yourself. No one else is responsible.

mckain

Thank you alchemist.1

lika_86

I'm not sure about this. I think that they did have a duty to at least ask the question and bring it to your attention as a property purchaser. Solicitors have a duty to act in their clients' best interests and it MIGHT have been in your best interest to get the sale through before 1st April (it might not, depending on the damp situation). However, you would have to show loss and if there was no way you'd have got completion through (not just exchange) before 1st April then it doesn't really matter, equally, pushing through completion may not have been in your best interests if there were outstanding issues in terms of the house that might have otherwise affected the purchase price (ie. if the damp issue resulted in a reduction of the purchase price which would have negated any SDLT increase then it wouldn't necessarily have been in your best interests to push the sale through).

This has been common knowledge in the conveyancing world and whilst you possibly should have been aware, they definitely were and I think they should have at least made you aware of it if it would have potentially made a difference. I'd query it with them.

ETA: Just noticed you said the original move in date was tomorrow, two weeks after the start of April which makes me wonder whether this could actually have been done before April in any event.

dc197

Maybe you should have known, maybe not. Maybe they shuld have asked you, maybe not.
Certainly, though: you should have told them about your situation, then they would have flagged this to you.
Our documents from our solicitor mention the importance of telling him everything (I'm paraphrasing) so that he can act in full knowledge for our best interests.

davidmcn

lika_86 wrote: »

Solicitors have a duty to act in their clients' best interests

Yes, but only within the parameters set by the instruction - they don't have to think of everything which might affect their clients.

A normal conveyancing transaction isn't going to include advising on the tax consequences (the stamp duty issue is a new one, but things like Capital Gains or Inheritance Tax aren't going to be covered unless specifically instructed). It may be a nice added extra to give information about stamp duty changes etc, but omitting to do so isn't I think cause for complaint.

mckain

Thanks for everyone's comments. I should have known, not sure how I missed this news ��. Will pay and just get on with it.

lika_86

davidmcn wrote: »

Yes, but only within the parameters set by the instruction - they don't have to think of everything which might affect their clients.

A normal conveyancing transaction isn't going to include advising on the tax consequences (the stamp duty issue is a new one, but things like Capital Gains or Inheritance Tax aren't going to be covered unless specifically instructed). It may be a nice added extra to give information about stamp duty changes etc, but omitting to do so isn't I think cause for complaint.

Of course they don't have to think of everything but the OP said that the solicitors provided a letter in January which gave the amount of the SDLT as it stood then. I think SDLT is closely connected enough with the transaction that they should have at least mentioned it and asked the question.