Based on the government’s quarterly stamp duty figures, the extra 3% Stamp Duty Land Tax (SDLT) fee intended for individuals purchasing second homes or buy-to-let assets increased £2.05 billion stamp duty in the year 2017.
Nevertheless, due to interruptions in marketing their old homesteads, thousands of regular homeowners have now found themselves accountable for the additional 3% SDLT.
This occurs when the previous property cannot be disposed before the purchase of the new one. The new methods intended for purchasers acquiring an additional asset include a reimbursement system in case the initial house is disposed in a span of 3 years, but the additional 3% SDLT still must be paid first and then reclaimed later on.
The statistics are considerable. Throughout 2017 over 15,700 property holders had to recover extra tax adding up to £194 million because of postponements with the first asset sale, growing the first fee load on property holders right before the tax was recompensed by HMRC.
George Bull, principal tax partner at RSM, held:
‘The limits of tax returns created from the additional 3% SDLT funded on extra assets, for instance, second homes and buy-to-let assets, will certainly be understood as a success for the Exchequer.
‘Nonetheless, it is undoubtedly unwelcomed that individuals trapped in a costly bridging deal, who were not the object of the additional 3% stamp duty fee, ought to be deprived of funds in this manner, then compelled to claim reimbursement. Because of the limits of naïve homeowners getting trapped in extra outlay, we request HMRC to consider a healthier system of managing this section of the SDLT structure.’