HM Revenue and Customs (HMRC) is cautioning people purchasing property against agents who promise refunds on Stamp Duty Land Tax (SDLT) for homes that need renovation. Some advisers suggest a property is non-residential to claim a refund, but following this advice can result in buyers owing the full tax amount along with penalties and interest.
The Court of Appeal, in Mudan & Anor v HMRC, confirmed that properties in need of repair are still treated as residential. Claims based solely on a property’s condition are not valid, and HMRC is cracking down on false or misleading refund claims using both civil and criminal enforcement powers.
In one case, a London homeowner paid an agent to reclaim £9,250 in SDLT. HMRC later ruled the property was residential, leaving the buyer liable for the full tax plus interest and fines. Anthony Burke, HMRC’s Deputy Director of Compliance Assets, urges buyers to be careful and review official SDLT guidance on GOV.UK before acting.
Info obtained here
