SDLT Shared Ownership ‘Sub Sell Relief’ Successes?

sdm1985

Hello,

I sold my shared ownership flat in November 2021, I had a 30% share and to sell on the open market, I had to do back to back staircasing to 100% and then simultaneous sale in the same moment.

I paid £6,200 in SDLT, which I thought was strange at the time, for something I never owned.

Has anybody had the ‘sub sale relief’ applied to their sale and paid no SDLT or claimed the relief after paying SDLT?

My solicitor is saying that they have only recently been using and advising on the relief, but I see articles going back to 2019..

SDLT_Geek

HMRC have not yet officially published their view on this and the legislation is not clear, but I used to hear occasionally of cases where HMRC confirmed on a one off basis that sub sale relief (now called pre-completion transaction relief "PCT") could be available on a back to back staircasing and onwards sale.  They then set out their view to some SDLT specialists in a meeting on 8 April 2022 that the relief can be available.  Here is an extract from the agreed note of the meeting:

"Pre-completion transaction relief can apply on a back to back staircasing and sale on (provided the other conditions for relief are met).  It is no objection that (for SDLT purposes) a share in the property is acquired and the whole of the lease is assigned onwards.  The embedded right in the lease to staircase provides the necessary contract to acquire a share.  HMRC have given clearances to confirm that PCT relief is available, but have not published their view."

The point is mentioned in the blog here: https://www.sharedownershipresources.org/an-expert-on/stamp-duty-selling/

HMRC say they are working on updating their guidance and plan to cover this point.

sdm1985

Thanks for sharing, so I should be able to make a claim on this basis? Even for November 2021? 

SDLT_Geek

It is too late to "amend" your return (a 12 month limit) but there is 4 years within which to make a claim for "overpayment relief".  HMRC are likely to be sympathetic, but there are a set of "cases" (see Finance Act 2003 / Schedule 10 / para 34A) on which a refund can be refused. 

One of the cases is that the SDLT was paid in accordance with the prevailing practice at the time.  It would be rather mean of HMRC to invoke that provision, when the difficulty is largely caused by their lack of good guidance.

SDLT_Geek

One of the other "cases" where HMRC can refuse overpayment relief is worded like this:

"34A (2) Case A is where the amount paid, or liable to be paid, is excessive by reason of—

(a) a mistake in a claim or election, or

(b) a mistake consisting of making or giving, or failing to make or give, a claim or election."

HMRC might say there has been a "mistake" in failing to make a claim for pre-completion transaction relief and that it is now too late to claim that relief.

sdm1985

Thank you so much, it would be very mean to keep my money - if they pay me back my SDLT will they also add the interest? 
Is there a specific form I can complete online and then print it off and post?
Thanks again!

SDLT_Geek

sdm1985 said:

Thank you so much, it would be very mean to keep my money - if they pay me back my SDLT will they also add the interest? 
Is there a specific form I can complete online and then print it off and post?
Thanks again!

Yes, if HMRC make a refund, then they pay interest.

There is no specific form to use for a refund.  It is made by letter sent in the post quoting the UTRN of the return, referring to a claim for overpayment relief under Finance Act 2003 / Schedule 10 / para 34, explaining the facts and making the case for a refund.

sdm1985

SDLT_Geek said:

sdm1985 said:

Thank you so much, it would be very mean to keep my money - if they pay me back my SDLT will they also add the interest? 
Is there a specific form I can complete online and then print it off and post?
Thanks again!

Yes, if HMRC make a refund, then they pay interest.

There is no specific form to use for a refund.  It is made by letter sent in the post quoting the UTRN of the return, referring to a claim for overpayment relief under Finance Act 2003 / Schedule 10 / para 34, explaining the facts and making the case for a refund.

`Thank you so much! Would you be kind enough to share the postal address? I will write it now. Thanks

SDLT_Geek

sdm1985 said:

SDLT_Geek said:

sdm1985 said:

Thank you so much, it would be very mean to keep my money - if they pay me back my SDLT will they also add the interest? 
Is there a specific form I can complete online and then print it off and post?
Thanks again!

Yes, if HMRC make a refund, then they pay interest.

There is no specific form to use for a refund.  It is made by letter sent in the post quoting the UTRN of the return, referring to a claim for overpayment relief under Finance Act 2003 / Schedule 10 / para 34, explaining the facts and making the case for a refund.

`Thank you so much! Would you be kind enough to share the postal address? I will write it now. Thanks

It is:

BT Stamp Duty Land Tax

HM Revenue and Customs

BX9 1HD

United Kingdom

ResourcesShared

As has been commented elsewhere in this Thread, HMRC's guidance on this issue is weak, has been for some time, and they don't seem in any hurry to update it. SDLT expert, Sean Randall, and consultant solicitor, Zahrah Aullybocus, have written on this topic for Shared Ownership Resources. Can't post the link here, but please Google their feature on shared ownership and stamp duty when selling.

SDLT_Geek

ResourcesShared said:

As has been commented elsewhere in this Thread, HMRC's guidance on this issue is weak, has been for some time, and they don't seem in any hurry to update it. SDLT expert, Sean Randall, and consultant solicitor, Zahrah Aullybocus, have written on this topic for Shared Ownership Resources. Can't post the link here, but please Google their feature on shared ownership and stamp duty when selling.

Agreed.
Here is the link (as posted higher on the thread): https://www.sharedownershipresources.org/an-expert-on/stamp-duty-selling/