Stamp Duty paid by builder

wesleyad

grefalo said:

My incentives say "to provide a stamp duty contribution of £15,000"

Still not sure what position this puts me in legally. Had they not been paying for stamp duty I would have pushed for more incentives. 

Almost certainly with this wording means they owe you the money. A "contribution towards" is clearly a payment from them to you, regardless of stamp duty levels.

Put it another way. Had this not happened, they would give you 15K. You could then choose to use that to pay your stamp duty or not. They are not paying your stamp duty, you are. In fact, you could refuse to pay it altogether (and get in big trouble with HMRC), but they would still owe you the 15k.

For this amount of money I'd be getting decent solicitor if they refuse

zazu94

Hi guys! Would like some help with this too - we had negotiated a £5k stamp duty incentive and the current stamp duty is below this. We had signed the contracts and were waiting for the ATE from help to buy. Our solicitor is now insisting that paperwork will have to be changed to reflect "that the tax incentive is now lower". Apparently if we do that we will also have to let the bank know. Im pushing for the £5000 incentive to remain and the balance be paid to us as cash to avoid delays (im currently renting and the new build is almost complete so any delays impacts when I can give notice and leave.

Our solicitor is however insisting that the tax incentive is changing and hence it all has to be resubmitted to Help to Buy. any thoughts as she is refusing to confirm until she gets "confirmation from Inland Revenue"

From what I've read here doesn't sound like it matters if the tax incentive> actual stamp duty?

MrLogical

Ankm, please keep us updated but I agree with everyone else here. If they have agreed to give you money, it shouldn’t matter how you choose to spend it and what the government has done with stamp duty. If they have said they will pay it for you and that the amount is linked to how much you will actually pay, it actually says this, then they would have taken the risk of paying more if it had gone up so makes sense from them to drop it. The wording is very important here. Whilst it may seem many of us are in a similar position, I think we will find people get differing results here.

davidmcn

zazu94 said:

Hi guys! Would like some help with this too - we had negotiated a £5k stamp duty incentive and the current stamp duty is below this. We had signed the contracts and were waiting for the ATE from help to buy. Our solicitor is now insisting that paperwork will have to be changed to reflect "that the tax incentive is now lower". Apparently if we do that we will also have to let the bank know. Im pushing for the £5000 incentive to remain and the balance be paid to us as cash to avoid delays (im currently renting and the new build is almost complete so any delays impacts when I can give notice and leave.

Our solicitor is however insisting that the tax incentive is changing and hence it all has to be resubmitted to Help to Buy. any thoughts as she is refusing to confirm until she gets "confirmation from Inland Revenue"

From what I've read here doesn't sound like it matters if the tax incentive> actual stamp duty?

Why is your solicitor insisting on it rather than fighting your corner? This isn't by any chance a solicitor "recommended" to you by the developer, is it?

(and it hasn't been the "Inland Revenue" since 2005 but maybe news travels slowly...)

FamilyFeud

We are in the same position at the moment we have exchanged back last year and we are due to complete very shortly and the builder agreed a financial incentive (as contract states) of 9k which was ear marked for stamp duty. So what we are now hoping for is for solicitors fees to be covered land the additional deposit (we changed mortgage in January for a better rate) they would still be better off as it would come under 9k so I think it’s reasonable but no one is getting back to us yet.

zazu94

davidmcn said:

zazu94 said:

Hi guys! Would like some help with this too - we had negotiated a £5k stamp duty incentive and the current stamp duty is below this. We had signed the contracts and were waiting for the ATE from help to buy. Our solicitor is now insisting that paperwork will have to be changed to reflect "that the tax incentive is now lower". Apparently if we do that we will also have to let the bank know. Im pushing for the £5000 incentive to remain and the balance be paid to us as cash to avoid delays (im currently renting and the new build is almost complete so any delays impacts when I can give notice and leave.

Our solicitor is however insisting that the tax incentive is changing and hence it all has to be resubmitted to Help to Buy. any thoughts as she is refusing to confirm until she gets "confirmation from Inland Revenue"

From what I've read here doesn't sound like it matters if the tax incentive> actual stamp duty?

Why is your solicitor insisting on it rather than fighting your corner? This isn't by any chance a solicitor "recommended" to you by the developer, is it?

(and it hasn't been the "Inland Revenue" since 2005 but maybe news travels slowly...)

It is a recommended developer...was all straightforward until this happened and I am convinced she'll also charge us for the 'rework'
I'm pushing her to say that if the developer pays us £5k then there is no issue and we can exchange but shes refusing to state that - our estate agent is happy to go back to the developer and propose that only when the solicitor confirms HTB paperwork does not need to change and we can exchange when the ATE comes through (was submitted Monday) so the developer may even be ok with exchanging on £5k cost!

Feel like im speaking to brick walls rn... i'm not crazy am I?

jon81uk

zazu94 said:

Hi guys! Would like some help with this too - we had negotiated a £5k stamp duty incentive and the current stamp duty is below this. We had signed the contracts and were waiting for the ATE from help to buy. Our solicitor is now insisting that paperwork will have to be changed to reflect "that the tax incentive is now lower". Apparently if we do that we will also have to let the bank know. Im pushing for the £5000 incentive to remain and the balance be paid to us as cash to avoid delays (im currently renting and the new build is almost complete so any delays impacts when I can give notice and leave.

Our solicitor is however insisting that the tax incentive is changing and hence it all has to be resubmitted to Help to Buy. any thoughts as she is refusing to confirm until she gets "confirmation from Inland Revenue"

From what I've read here doesn't sound like it matters if the tax incentive> actual stamp duty?

Don't think its got anything to do with Inland Revenue / HMRC. As far as they are concerned you don't owe them any tax and thats that.
Help to buy and your mortgage lender may need to know if your incentive changes, but if you are getting £5k from the developer it doesn't matter what you spend it on to them, just that you are receiving the incentive so I don't think anything needs to change. What you need to check is the wording of the contract (and the reservation form that came before that), if it states you are getting £5000 you should get it. If it states stamp duty paid in full with no cash figure then you may have to argue.

Newbie83

We have the same issue. Our reservation form states an incentive of £x for stamp duty. I have gone back to the builders to ask if we can have the difference in cash and are waiting for them to come back and confirm after checking with head office. If they say no I will speak to my solicitor to check the legal stance on this. My developer doesn’t do extras but we would have asked for legal and moving costs etc instead. I will update on their stance when I hear back however I think they should still be liable to pay the full amount agreed but they are most likely checking with their legal team to see where they stand on this also. 

macman

Any sensible drafting of the contract would have said 'stamp duty paid up to a maximum of £X'. That would allow for a reduction, but also cap them, had stamp duty rates actually risen. Which, a year ago, when many of these contracts were presumably written, was not an impossibility, had Corbyn come to power.

San_Jose

Just an update on my situation as I've got hold of my builder. Im yet to complete on my property and they are offering me a voucher for options upto the same value of stamp duty they would have paid. Which I'm personally happy about as we were going to pay for some of these options anyway. I have also gone back to them and asked if I can have some of it used for legal fees as well.