The HMRC is set to update its guidance on the higher rate of Stamp Duty which has been deemed confusing.
According to HMRC figures, since the Government’s additional 3% Stamp Duty was applied to second homes in 2017, there have been more than 15,700 cases of transactions which have mistakenly paid the charge who are now eligible for a refund,
In one reported case, David Poole bought a property with his wife Emma.
The couple had been living in rented accommodation having sold their main residence over ten years previously.
However, they were told that because Emma owned two buy-to-let properties, they would have to pay an extra £14,160 in stamp duty.
He and his wife ended up paying almost £28,000 in Stamp Duty but David Poole continued to believe they should not have paid the surcharge and was eventually proved right.
Now HMRC has indicated that it will update its guidance.
A spokesman for HMRC said: “We keep all guidance under constant review, including taking legal developments into account.
“HMRC is working to update its guidance on the higher rates of stamp duty land tax.”
The news comes after the Law Society criticised a “lack of clarity” in the guidance.
Sarah Dwight, a member of the Law Society’s conveyancing and land law committee, said: “It is a very complex area and the guidance does not give conveyancing lawyers much clarity.
“HMRC seems to have thought the guidance it issued was going to be sufficient, but there are so many different types of scenarios that arise when people are seeking to buy and sell a property, that not everyone fitted into HMRC’s boxes.”
Sean White Senior Partner in charge of conveyancing at Courtyard Solicitors in Wimbledon and Totnes, Devon, said "The rules relating to when the higher rates are or are not payable are confusing. In order to calculate the duty due most people use the HM Revenue & Customs calculator which asks a number of questions and then says what duty is payable. Unfortunately, not all cases fall clearly within the ambit of the questions asked."
