PROPERTY INVESTOR

Never assume it's too late to get a refund on your SDLT

Kerry approached us to see if there was any chance of reducing SDLT on a property she’d bought through her property company for refurbishment.

The 2019 case of Bewley showed that where a property is not ‘suitable for habitation immediately on completion’ it’s not a dwelling. However, what this actually means is 'open to interpretation'!

In this case, the client had purchased at £78,000 so the additional 3% applicable to residential purchases by companies meant that SDLT of £2,340 had been paid.

Various things were wrong with the property and the mortgage valuation had described it as ‘unfit for letting’. However, this is a somewhat higher standard than ‘not suitable for habitation’. The property had been un-occupied following the death of the owner and the executors had removed most of the kitchen fittings, so it was impossible to prepare even the most basic meal there - but even this may not have been sufficient by itself, as recent cases have shown.

Upon starting the refurbishment, our client became aware of serious issues that weren't apparent when she had bought the property initially. This meant that she had overpaid on SDLT.  

The secret to getting a tax refund - ask an expert

With our assistance, the SDLT was re-assessed on the non-residential rate and, being below the threshold of £150,000, there was no basic SDLT and of course, the 3% did not apply. Our client was delighted to receive a full refund plus interest.