Homeowners could be entitled to stamp duty refunds worth thousands

Homeowners across the UK could be entitled to claim stamp duty refunds worth thousands of pounds from HMRC, Cornerstone Tax has revealed.

The stamp duty advisory practice suggested people could be eligible to claim a refund if they have unknowingly overpaid on Stamp Duty Land Tax (SDLT).

Cornerstone said that “commercial activity” on someone’s land turns their house into a “mixed use” property in regards to stamp duty, meaning they would only be liable for the lower non-residential rates.

This does not mean the seller has to have run a business from the property, but whether the house, or its land, generates a business income, Cornerstone stated.

The tax expert added that this comes in many forms, from having a commercial business operating on-site, to renting or licensing part of the buildings or land to someone else to use – known as property business income in HMRC terms.

Cornerstone suggested that no matter how little of the land is used, or how small the income is, if land is being used it is therefore “conclusive” that some homeowners shouldn’t be paying, or have paid too much via the residential rate.

The tax expert also highlighted wayleave agreements, which give rights to utility companies to install, place or run their equipment on the land that a property sits on, in order to provide power, water, or sewerage. In return for granting the right to use this land, the utility company would usually pay a fee, similar to a tenant paying rent to a landlord – which Cornerstone also noted would therefore qualify a property as a “commercial use”.

Another situation that the tax specialist suggested people could be allowed to pay the lower non-residential stamp duty rate is through properties with an annexe – with homeowners potentially eligible for Multiple Dwellings Relief.

“Since the start of the initial lockdown in March, we have been inundated with requests to look into whether people have overpaid on stamp duty,” commented Cornerstone founder, David Hannah.

“The effects of the pandemic have made people more aware of their personal finances, and many who previously wouldn't have bothered to look into whether they had overpaid, are now seeing this as an opportunity to get some extra cash quickly.

“It remains to be seen how many cases of overpayment have occurred, but at Cornerstone Tax, we are aware of several cases where the overpayments amount to several hundreds of thousands of pounds.”

    Share Story:

Recent Stories


FREE E-NEWS SIGN UP

Subscribe to our newsletter to receive breaking news and other industry announcements by email.

  Please tick here to confirm you are happy to receive third party promotions from carefully selected partners.


The new episode of The Mortgage Insider podcast, out now
Regional housing markets now matter more than ever. While London and the Southeast still tend to dominate the headlines from a house price and affordability perspective, much of the growth in rental yields and buyer demand is coming from other parts of the UK.

In this episode of the Barclays Mortgage Insider Podcast, host Phil Spencer is joined by Lucian Cook, Head of Research at Savills, and Ross Jones, founder of Home Financial and Evolve Commercial Finance.

The role of the bridging market and technology usage in the industry
Content editor, Dan McGrath, sat down with chief operating officer at Black & White Bridging, Damien Druce, and head of development finance at Empire Global Finance, Pete Williams, to explore the role of the bridging sector, the role of AI across the industry and how the property market has fared in the Labour Government’s first year in office.


Helping the credit challenged get mortgage ready
A rising number of borrowers are finding it harder to access mortgages due to being credit challenged - whether that’s from historic debts, a county court judgment, or having little to no credit history.

In the latest episode of the Mortgage Insider podcast, Phil Spencer is joined by Eloise Hall, Head of National Accounts at Kensington Mortgages, and Alastair Douglas, CEO of TotallyMoney.

The future of the bridging industry and the Autumn Budget
MoneyAge content editor, Dan McGrath, is joined by head of marketing at Black & White Bridging, Matt Horton, to discuss the bridging industry, the impact of the Autumn Budget and what the future holds for the sector.