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New homeowners warned over fake stamp duty refund claims

New homeowners are being warned about cold calls from scammers advising them to make speculated stamp duty refund claims.

The warning comes after HMRC said a recent spate of stamp duty refund claims failed to meet very specific criteria.

Rogue tax agents have been known to call new property owners after finding them through Land Registry records and property search websites, promising money back on ‘unknowingly overpaid’ stamp duty.

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Recent analysis by HMRC suggests that up to a third of claims for ‘multiple dwelling relief’ refunds were incorrect.

HMRC raise enquiries on these claims, but sometimes that is after the agent has taken their fee, leaving the homeowner to pick up the difference. 

Incorrect refund claims must be repaid with interest, with some potentially facing penalties as well.

In a recent example, a letter from a rogue agent suggested a homeowner may have overpaid £60,000 worth of Stamp Duty. The agent claimed the home could be designated as two properties, despite it clearly being one. 

Another false submission claimed that a bedroom could be a separate dwelling and in line for claiming ‘multiple dwellings relief’ because it had an en-suite and a built-in wardrobe which could be a kitchen if you added a microwave and a kettle.

HMRC also highlighted a case where a new owner of a six-bedroom house claimed it was not a wholly residential property because a room above a detached garage was used as an office.
 

Nicole Newbury, HMRC director for wealthy and mid-sized business, said: “We are seeing obviously spurious refund claims that are never going to succeed; but will lead to an unnecessary bill for the customer.

“So we are warning new homeowners not to get caught out by tax repayment agents promising easy money on a ‘no win, no fee’ basis. If it sounds too good to be true, it probably is. 
“We want to help people get it right and avoid unnecessary tax bills, so treat promises of easy money with real caution.

Anyone approached about a stamp duty refund claim should check with their original conveyancer, take independent professional advice and check HMRC’s guidance by searching ‘Stamp Duty Land Tax’ on GOV.UK. You can also contact the HMRC helpline on 0300 2003 510.

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    Standard “warning” piece from HMRC… “check with your original conveyancer”… one would hope that if there were savings to be made your original conveyancer would have pointed them out!

    The reality is that most conveyancers have a very limited knowledge of what is fundamentally a quite complex and historic area of tax law.
    Any firm worth dealing with, will have guarantee / insurance cover in the event of a challenge.

    If HMRC don’t like the law then the onus is on them / Govt to change it, not to use moral
    lecturing and threatening articles to prevent the tax payer from making legitimate savings which the law allows for.

    Of course this has only become a matter for HMRC since the Govt increased top rate SDLT from 4% to 17%… I’m pretty sure there’s a lesson in there somewhere!

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