If you have bought a property in the UK then you know about Stamp Duty and what it entails. The Stamp Duty Land Tax (SDLT) is a tax that is applicable to all property bought in the United Kingdom. It is a huge part of the buying process and is one of the biggest expenditures that buyers will make during the buying process.
In recent years, changes to the law as well as based on recent case law, more people are eligible for a stamp duty rebate. That is some or all of the money back from the money they paid for their stamp duty in the first place.
There are a myriad of reasons why you might be eligible for a stamp duty rebate or refund. This guide takes you through what stamp duty is, what a stamp duty rebate is and how long the process takes as a whole.
If you believe that you might be eligible for a stamp duty refund then it is worth speaking to some experts in order to find out more and see if you get yourself some money back that you are owed!
What is Stamp Duty?
Stamp duty land tax is a tax that you pay on property or and purchases in England and Northern Ireland (Scotland and Wales have similar schemes). The amount of Stamp Duty that you pay will differ depending on a number of factors.
Your buying status including whether you are a landlord, first time buyer or purchasing a holiday home will also change the price of the Stamp Duty. The price of the property that you are buying is also an important determinant of how much your Stamp Duty will cost you.
The people purchasing the property pay Stamp Duty and the tax does not incur VAT. There is also something called Stamp Duty surcharge.
A surcharge will be added on top of your original Stamp Duty if you are purchasing a buy-to-let property as a private landlord or through a limited company. You will also be charged the surcharge if you are buying a second home for £40k or more (for more information see the Gov website).
Stamp Duty seems pretty organised and structured, so how is it possible that you might be owed money for the Stamp Duty that you paid on your property?
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What is a Stamp Duty Rebate?
A Stamp Duty Rebate is when you have overpaid for your Stamp Duty when you should have paid less or not paid at all. A Stamp Duty Rebate allows you to get back some if not all of the money that you spent on the tax in the first place.
There are a few reasons why you might be eligible for a stamp duty rebate, this includes:
- Second Home Stamp Duty Refund – You will be eligible for a stamp duty refund on your second home surcharge if you sell your main residence within three years of paying the additional 3%.
- Shared ownership stamp duty refund for first-time buyers – Shared ownership properties purchased by first-time buyers will be exempt from stamp duty, providing the home’s value does not exceed £500,000.
- Property Defects – Lastly, if the property had defects when you bought the property you might be eligible for a Stamp Duty rebate. You can now qualify for a stamp duty rebate should there have been any defects such as; faulty boiler or electrics, damp, structural issues, subsidence, asbestos, drainage issues, and others.
How long does a Stamp Duty Rebate take?
After you submit your application with the help of experts and you provide HMRC with all the relevant information then the claim can be processed within 15 days. If your claim is not settled within this time, you could be entitled to any interest due on the refund, but you will not be able to file for compensation.