Real Estate Tip of the Week - SDLT Payment and SDLT Returns – time frame reducing

Published 21 enero 2019

The time period for filing an SDLT return and paying the SDLT due will, from 1 March 2019, reduce from 30 days to 14 days.

The “14 day clock” will start to run from the day following the “effective date” of your transaction. Generally the effective date is the day you complete a lease or transfer of land, however, it can be earlier, if for example you substantially perform an agreement in advance of completion. One of the most common scenarios we see where an SDLT deadline is brought forward is where a prospective buyer or tenant takes early occupation under an agreement for sale or lease to carry out works.

If you miss the 14 day filing window you will incur an automatic £100 penalty from HMRC. If the filing delay reaches 3 months then the penalty doubles to £200. If you are a year or more late in filing a return, HMRC can levy an additional penalty calculated as a percentage of the unpaid SDLT, the percentage depending on the circumstances of the late payment.

Late payment interest will also accrue if the SDLT is not paid to HMRC on time (i.e. within 14 days of completion), the rate is currently 3.25% per annum and charged on the outstanding amount of SDLT.

This change applies to SDLT only, it does not apply to properties in Wales or Scotland, which are subject to LTT or LBTT respectively.

If you would like further details on this imminent change, please feel free to get in touch with Matt or John in our tax team.