no refund of stamp duty if walk away after long-stop date?

ibuythings

Hi, I have bought an off-plan lease hold property last year and have already paid two installments total 50% of the price and also paid for the stamp duty. The property has a long-stop date on December 31, 2018. But recently I find told that the practical completion date of the flat has changed to March 31, 2019. My solicitor said I have the right to terminate the agreement at any time after the expiration of long stop day and receive back the premium already paid. However she told me that the stamp duty that I have paid will have no refund. I wonder if it is true and why and still waiting her reply. If I do not own the property at the end why should I pay for the stamp duty?

AdrianC

The SDLT isn't due to HMRC until completion. Are you paying it to the developer in the interim to pay on your behalf? What does the reservation contract say?


And are you using the developer's "recommended" solicitor...?

G_M

As Adrian says, if you don't Complete on the purchase, then no SDLT is payable to HMRC.


But since you have, for some reason,paid the SDLT to the developer, it is to your contract with the developer that you must look. What does it say exactly about this payment?

davidmcn

It makes no sense for you to be paying the SDLT to the developer, or to be paying it to anyone at this stage, and even less for you not to get it back from whoever has it, given that nobody has to pay it to HMRC if the purchase doesn't happen. So either there's something mighty weird about your contract, or there's been a breakdown in communication somewhere.

ibuythings

Thanks all.
just look at the Agreement for Sale but did not mention anything regarding the SDLT. I don't know why they give such answer if it is not true. What should I do if they don't refund the SDLT?

Yes, the solicitor was recommended by the developer and the communication has been smooth and efficient, but the recent enquiry on the withdrawal of agreement after long stop date took them more than two weeks to response.

Tom99

[FONT=Verdana, sans-serif]Point out to the solicitor that:[/FONT]
[FONT=Verdana, sans-serif]1 No stamp duty has to be paid before completion.[/FONT]
[FONT=Verdana, sans-serif]2 The seller is not the one who pays stamp duty the buyer is, but the buyer's solicitor (you) usually does this on their behalf.[/FONT]
[FONT=Verdana, sans-serif]3 Therefore Mr Solicitor you must be holding all of this supposed stamp duty for me ready to pay it on completion, yes?[/FONT]
[FONT=Verdana, sans-serif]4 I want this 'stamp duty' back. If you have sent it to the seller, that's your problem, because is was obviously the wrong thing to do.[/FONT]

eddddy

ibuythings wrote: »

Hi, I have bought an off-plan lease hold property last year and have already paid two installments total 50% of the price and also paid for the stamp duty.

If you're paying installments, this doesn't sound like a 'regular' off-plan property purchase. It sounds more like an investment scheme.

You need to read the terms of the scheme (which you have agreed to), to see what happens if you back out after the long-stop date.

You may lose a percentage of your money (which might happen to be equivalent to the eventual SDLT).

G_M

ibuythings wrote: »

Thanks all.
just look at the Agreement for Sale but did not mention anything regarding the SDLT......

Yes, the solicitor was recommended by the developer and the communication has been smooth and efficient, but the recent enquiry on the withdrawal of agreement after long stop date took them more than two weeks to response.

1) So what exactly does the Agreement say about payments? If thismoney you paid is not described in the Agreement as SDLT, then what is it described as?


2) Using a solicitor recommended by a developer is never wise. He has an interest in maintaining his relationship long-term with the developer, so may be tempted not to always act in your best interests.........

ibuythings

Hi all, thanks for your advice and help.

The update situation, my solicitors said a TR1 form would be lodged at the Land Registry, it is a procedure to claim back the SDLC which has been paid. is that true?

My solicitor told me that 1st and 2nd Notice for Agreement Termination had been sent to developer solicitor. And In a latest correspondence also urged them to give back the premium (1st and 2nd deposits) by 9 Wed. However developer solicitor contested the Notices on various points and alleged the termination of agreement is invalid, and then alleged the termination of the agreement for sale amounts to a repudiatory breach of the agreement for sale. They did not give back the premium and did not response to the deadline.

My solicitor said they will pass the case to their Litigation Dept. with a view to Court Proceedings now being issued to recover the full payment of the deposits.

I'm not sure if my solicitor is acting in my best interest, the situation is complicated then I thought. it seems the case would submit to court?! can anyone please advise? what should I do now?

Many thanks