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SDLT consultation on mixed use & MDR

https://www.gov.uk/government/consultations/stamp-duty-land-tax-mixed-property-purchases-and-multipl

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This has always just been a matter of time of course.

https://www.gov.uk/government/consultations/stamp-duty-land-tax-mixed-pr...

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Jason Croke
By Jason Croke
30th Nov 2021 16:15

I do feel HMRC's pain but I take issue with this paragraph :-

"HMRC has also seen an increase in the numbers of residential property purchasers being approached by so-called ‘SDLT reclaim agents’, after a property has been bought and tax paid at the residential rates of SDLT. These agents submit questionable claims in return for a significant proportion of any tax refund that is secured. Such questionable claims use the slightest suggestion of non-residential use to seek to render the whole property liable to the lower non-residential rates of SDLT, even though the true nature of the property is wholly residential."

I know what they mean, but the use of the words "so called reclaim agents"...no, they are legitimate appointed tax agents dealing with an SDLT reclaim, nothing "so called" about it.....and the word "questionable claims", well its only questionable because HMRC and tribunals have not always agreed on definitions and these specialist firms take advantage of the ambiguity.

I do appreciate that there are a couple of firms out there who specialise in these claims, pushing the boundaries and you and I see regular tribunal cases where the QC's are straight faced trying to argue a detached garage is a separate dwelling or a shed has a toilet and a microwave ergo its a dwelling....so I do welcome HMRC's intent to review and change the rules as that sort of aggressive tax planning is not for me, but I also accept that some taxpayers want to push things to the edge and there will always be a market to service that type of taxpayer.

I think an apportionment based on Appendix A makes sense as it more fairly reflects what the property actually is (ie, shop with flat above), I can see the so called SDLT experts trying to push the definition of what is non-residential (ie, the shop with a flat has both a front parking space and a rear parking space and garden but is that assigned to the flat or the shop or both....) but I think the proposed approach will make things much fairer, albeit more likely in HMRC's favour.

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