It has been widely trailed that we are likely to see Stamp Duty Land Tax changes in the forthcoming Budget.
The prime minister announced at the Conservative Party Conference that overseas buyers would be subject to a three percentage point surcharge, similar to that already levied on landlords and buyers of second homes.
With a rapidly decelerating market, economic uncertainty and a potential exodus from some parts of the property market, the government seems to forget that confidence and certainty are easily lost and hard to win back. It also appears to be doing its best to make Stamp Duty Land Tax the most complex and badly understood tax on the books.
Busy conveyancers now find themselves on the front line of trying to explain the myriad rules, additional charges and exemptions, as well as the complex submission forms, to increasingly exasperated clients who simply want to know how much tax they have to pay to buy a property.
Those same clients understandably do not feel that they should have to pay additional fees to be guided through the legislation or the forms — and some are increasing the pressure on their advisers to take their answers at face value and seek a quick solution.
But there are now a whole host of ways that innocently submitted SDLT returns can be adjudged to have incorrectly applied the rules, and the professionals concerned are increasingly worried that their clients — and they — are treading on dangerous ground that could lead to penalties and unwarranted accusations of tax avoidance or even evasion.
While the recently threatened surcharge for foreign-based buyers might play well to the gallery and seem a good way of raising additional revenue, it is unlikely to outweigh the financial effect on the industry as a whole, the additional layers of complexity for buyers of residential property and their advisers, or indeed the risk of fatal consequences to the “golden goose”.
No comments yet