Technically, what are you as a business?

For stamp duty reclaims, we act as an agent on your behalf in your dealings with HMRC. We present your case for obtaining a stamp duty refund if appropriate.
For stamp duty case files, we offer expert advice and case file evidence to correctly assess your property as non-residential before purchase.

What is a stamp duty refund and why does it exist?

Stamp Duty Land Tax (SDLT) is a tax paid to the government when purchasing a property. The amount varies depending on the buyer’s circumstances and the type of property. In some cases, such as for investors, second homeowners, or those purchasing properties over £1 million, the SDLT cost is lower if the property is classified as ‘non-residential’ for stamp duty purposes.

If a property is uninhabitable at the time of purchase, it cannot be classified as residential, as it is unreasonable for someone to reside there, e.g., due to excessive damp and mold. For certain buyers, non-residential stamp duty rates are typically lower than residential rates. These buyers can claim a stamp duty rebate from HMRC (Her Majesty’s Revenue and Customs) if they’ve purchased an uninhabitable property. However, HMRC doesn’t make the process easy, necessitating organizations like ours to represent clients’ interests.

What is a typical stamp duty calculation?

We have a stamp duty calculator that helps you estimate the amount of stamp duty you may be able to reclaim. You can find it here: stampdutyadvicebureau.co.uk/tools/stamp-duty-calculator (Link opens a new tab)

Scenario 1:

• Property investor buys a property to rent out
• The property was technically uninhabitable for stamp duty purposes and therefore non-residential
• Property cost: £250,000
• Stamp duty paid: £7,500
• Non-residential stamp duty: £2,000
• Potential stamp duty rebate: £5,500
• Our fees: £1,930
• Client windfall: £3,570

Scenario 2:

• Foreign national property investor buys a property to rent out
• The property was technically uninhabitable for stamp duty purposes and therefore non-residential
• Property cost: £250,000
• Stamp duty paid: £12,500
• Non-residential stamp duty: £2,000
• Potential stamp duty rebate: £10,500
• Our fees: £3,420
• Client windfall: £7,080

Scenario 3:

• UK resident property owner purchases a home in London
• The property was technically uninhabitable for stamp duty purposes and therefore non-residential
• Property cost: £1,800,000
• Stamp duty paid: £127,250
• Non-residential stamp duty: £79,500
• Potential stamp duty rebate: £47,750
• Our fees: £11,390
• Client windfall: £36,360

What are the potential risks of making a stamp duty refund claim?

Risks with us: 

We offer a no win no fee arrangement, so there is minimal risk for our clients. If your stamp duty claim is successful and HMRC pays you, we will receive our fees. However, if HMRC contests the case and demands a refund, we will refund 100% of our fees to you. This ensures a complete money-back guarantee for our clients.

Risks with HMRC:

Claiming a stamp duty refund from HMRC is a low-risk process since they evaluate the evidence provided by both parties to make a judgment. If the evidence is truthful, clear, and compelling, and HMRC approves the refund, they have made a decision in your favour that they are highly unlikely to contest.

How long is it before HMRC may not contest a stamp duty reclaim?

To avoid issues with HMRC, it’s important to keep the stamp duty savings for 9 months after reclaiming. While it’s possible HMRC may challenge the decision beyond the 9 months, it’s unlikely based on past cases.

Do you reimburse your fees if HMRC contests my claim and decides to recover the money?

Yes, we will refund 100% of our fees.

How can I calculate the amount of stamp duty I overpaid?

To calculate the amount of stamp duty you overpaid, you need to compare the amount of stamp duty you paid at the time of the property transaction to the correct amount you should have paid based on the property price and the relevant reliefs and exemptions. If the amount you paid is higher, then you may be entitled to a refund for the difference. We have built a useful tool to help you estimate your stamp duty refund.

Does the stamp duty classification as commercial property suggest that the property is unsuitable for residential letting?

The stamp duty classification for a property, either as ‘residential’ or ‘non-residential,’ is solely for stamp duty tax purposes. Even if a property is reclassified as ‘non-residential,’ bank lenders, local authorities, and insurers will continue to consider it as residential. Furthermore, if a ‘non-residential’ property is renovated and resold, it is likely to be reclassified as ‘residential’ upon completion, as it will be habitable. In summary, the stamp duty classification is specific to HMRC and does not impact any other organization’s evaluation of the property.

Does the stamp duty classification as commercial property affect a selective licensing application if the property requires a license for letting?

There is no impact on a selective licensing application due to the property’s stamp duty classification as commercial property. As mentioned earlier, the ‘non-residential’ classification is only used by HMRC for stamp duty purposes and does not influence other aspects, such as licensing applications.

Is it possible to reclaim overpaid stamp duty if my mortgage is with Gatehouse Bank?

Yes, you can reclaim overpaid stamp duty if you have a mortgage with Gatehouse Bank, provided that you have a valid reclaim case. We have had several successful reclaims involving Gatehouse Bank mortgages.

Does stamp duty charged as commercial property cause any issues with a Gatehouse BTL mortgage? Would it violate the mortgage policy?

While this involves some intricate aspects related to Sharia mortgages, the stamp duty classification as a ‘non-residential’ property does not have any implications on the mortgage agreement with Gatehouse Bank. As explained previously, a ‘non-residential’ classification for stamp duty purposes is solely relevant to HMRC.

Does the process for reclaiming stamp duty differ if I have a Gatehouse Bank mortgage?

Overall, the process remains the same. However, there is a minor difference. With a Sharia mortgage, you technically purchase a property and then sign it over into co-ownership with the Sharia bank. This leads to duplicate conveyancing paperwork, including the SDLT5 form. If you have purchased a property with a Gatehouse mortgage, your conveyancing solicitor will have submitted an SDLT5 form, and Gatehouse Bank will have done the same. We will need both copies of your SDLT5 for the reclaim process.

If I am a foreign national for tax purposes and I buy a property in the UK, can I get repayment of the non-UK Resident Stamp Duty Land Tax surcharge?

If all buyers of a property are individuals, you or your representative can request a refund for the surcharge paid. To be eligible, every purchaser must spend at least 183 days in the UK within any continuous 365-day period:

– starting no later than 364 days before the transaction’s effective date
– ending no more than 365 days after the transaction’s effective date

The transaction’s effective date is typically the completion date. To claim the repayment, you must apply within 2 years from the effective date of the transaction.

Will there be any issues if the property is to be resold as a residential property in the future?

As previously explained, the HMRC classification of ‘residential’ or ‘non-residential’ is used in the context of stamp duty taxes to be paid. So, if a property is classified as non-residential for stamp duty purposes and it is resold in the future, it would be sold as a residential property, assuming the building is used as a place of residence.

Can I get a refund if I overpaid stamp duty?

Yes, you may be eligible for a refund if you overpaid stamp duty. However, to determine if you are eligible for a refund, you will need to assess the specific circumstances of your case, including the property price, type, and purchase method. To reclaim the overpaid stamp duty, you will need to submit a detailed report to HM Revenue & Customs (HMRC) explaining the reasons for the overpayment and any reliefs or exceptions that were missed.

What is the process for claiming a stamp duty overpayment refund?

The process for claiming a stamp duty overpayment refund typically involves the following steps:

• Determine eligibility: Check if you are eligible for a refund by reviewing the calculations and assessment of the property and the stamp duty paid.
• Gather supporting documents: Collect all relevant documents such as the property purchase contract, receipts, and evidence of any reliefs or exceptions claimed.
• Submit a report to HMRC: Prepare a detailed report explaining the reasons for the overpayment and provide evidence of any reliefs or exceptions that were missed. Submit the report to HM Revenue and Customs (HMRC).
• Wait for HMRC review: HMRC will review the report and any supporting documents to determine if a refund is due.
• Receive refund: If the claim is approved, you will receive the refund via check or direct deposit, depending on your preferred method.
• Note: The time frame for this process can vary, depending on the complexity of the case and the workload of HMRC. It is important to keep records and all documentation in case of any future enquiries.

How do I know if I qualify for a stamp duty refund?

The primary factor that determines if you qualify for a stamp duty refund is the habitability of your property at the time of purchase. We have a condition assessment tool that can provide an overview of whether you may be eligible for a refund.

Otherwise, to determine if you qualify for a stamp duty refund, you will need to assess if you overpaid the tax during your property purchase. This can occur if the calculation of the tax was incorrect, and you paid more than you were required to. You may also be eligible for a refund if you were not aware of any available reliefs or exceptions that you were entitled to. To claim a refund, you will need to submit a detailed report to HM Revenue and Customs (HMRC) explaining the reasons for the overpayment and supporting evidence of your eligibility for any reliefs or exceptions.

What evidence do I need to provide for a stamp duty refund?

• To claim a stamp duty refund, you need to provide evidence to support your claim. This evidence may include:
• Proof of purchase, such as a copy of the purchase agreement or the title deed.
• Details of the property, including its address, size, and description.
• Information on the date of purchase, the purchase price, and the amount of stamp duty paid.
• Any relevant receipts, invoices, or other supporting documentation that demonstrate the reasons for the overpayment.
• A detailed report that explains why you believe the stamp duty was mis-assessed, and how you believe the amount overpaid should be refunded.
• It is important to keep accurate records and gather all relevant evidence before making a claim, as this will increase your chances of success.

We have a comprehensive guide available to help you understand what you need.

How long does it take to get a stamp duty refund?

The time it takes to receive a stamp duty refund varies and depends on several factors, including the complexity of the case, the workload of HMRC, and the availability of the required documentation and evidence. On average, it can take anywhere from 5 weeks to 3 months to process a stamp duty refund claim and receive the refund payment.

Once HMRC have agreed to refund your overpaid stamp duty, you will get the refund within 5 days of the HMRC decision.

Can I still get a refund if I’ve already completed the property transaction?

Even if you have completed the property transaction, it is still possible to get a refund for overpaid stamp duty. In general, all house purchases made after January 2018 may be eligible for a refund if they meet the criteria for being considered uninhabitable.

What are the chances of success in getting a stamp duty refund?

The chances of success in getting a stamp duty refund will depend on several factors such as the reason for the overpayment, the evidence available to support the claim, and the accuracy of the documentation and calculations. It’s difficult to estimate the chances of success without a detailed assessment of the specific case.

But, we have a condition assessment tool that can provide you with an estimation of the probability of receiving a refund.

Can I get a refund if I used Multiple Dwellings Relief (MDR)?

It is possible to get a refund for overpaid stamp duty if you used Multiple Dwellings Relief (MDR) during the property transaction. If there was an error in the calculation or if the conditions for MDR were not met or one or more of the properties was incorrectly assessed as ‘residential’, it may be possible to reclaim some of the overpaid tax. However, the likelihood of success will depend on the specific circumstances of the case, including the evidence available to support the claim and the accuracy of the documentation and calculations.