31 Oct Stamp Duty Mitigation Schemes
Attempts by property purchasers to buy property and avoid paying Stamp Duty Land Tax have been on the rise in recent years and all over the news in recent days.
A quick google search for the terms throws up quite a lot of discussion and also a new of firms offering these schemes.
Whilst the attraction of these schemes is obvious, whether they actually work is not so clear. It seems hard to find any conclusive evidence of whether they work or not. The further confusion allows around the rules, which allows HMRC 10 months from completion of the purchase to challenge the scheme.
No -one is really confessing whether they work or not.
You can however see why the schemes are being actively marketed, where the arranger splits the saving, typically on a 50:50 basis with the applicant.
Certainly as London mortgage brokers, specialising in large mortgage loans, we are constantly being approached by firms asking us to market their schemes.
They really grew out of the Credit Crunch. When Solicitors and tax planners suddenly became quiet, as commercial and residential transactions plummeted, they needed to find new sources of revenue. It seems these schemes were being used on much higher transaction values, but are now are becoming available to all through these new providers.
What happened last week was telling. Basically HMRC went public saying that is was now challenging these schemes. No why would they do that unless they were losing revenue?
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