Five incredibly useful Stamp Duty tips for UK solicitors

Five incredibly useful Stamp Duty tips for UK solicitors

Stamp Duty is hardly the most glamourous of subjects, but getting it right can be the difference between a thriving practice and a struggling one in the current climate. With PII premiums rising quarter on quarter, “claims farms” filing multiple claims on behalf of clients who think they might have missed out on a juicy SDLT relief and even the Law Society getting in on the act with new requirements for lawyers in their CQS guidelines, SDLT is no longer a subject firms can afford to ignore.

Here are our top five tips for avoiding costly errors and keeping your firm on the right side of the rules (and your clients).

1. Don’t take anything for granted

Often when a relief is missed it comes down to a detail that wasn’t necessarily included in the sales particulars or even the questionnaires filled in by the vendor. Perhaps the property has a completely separate annexe. Maybe there’s an informal arrangement with a local farmer to use land attached to the property for grazing which has been long-established. Whatever it is, small details can make huge differences to the potential stamp duty bill. Make sure you don’t get caught out!

2. Double Check your Workings

Unless your firm is lucky enough to have its own in house tax department, it’s unlikely that anyone will be a tax expert. And with Stamp Duty being a self-assessed tax involving a detailed return on the client’s behalf and a personal liability to them, you really want to make sure that you get it right. Whether it’s an ad-hoc arrangement with a local tax adviser firm or something a bit more formal, it’s worth forging a partnership with an expert firm to make sure you’re getting it right.

3. Check your case files

It’s all very well being proactive with new cases, but a lot of the issues we are seeing firms have relate to historical cases which are being dredged up by claims firms. Get ahead of the issue by digging back through the last four years of your case files and auditing the SDLT returns to make sure they were done correctly – there are firms who will help with this if required. A client who receives a call from you proactively saying you’ve found they may be owed a refund is likely to be a lot happier with your firm than one who’s been approached with the same information by a third party.

4. Get up to date (and stay there)

SDLT is one of the most rapidly altering and complex taxes on the UK statute books, with successive governments tweaking and adding to it year on year. In the past eighteen months alone we’ve had a Stamp Duty ‘Holiday’ and the introduction of a new ‘surcharge’ aimed at non-UK resident purchasers. Just because you memorised all the rules five years ago doesn’t mean they don’t look very different now, and missing a change could result in your client underpaying and having issues down the line.

5. Get some direction with Compass

Of course, the easiest way to take care of all the above is to get Compass for your firm. Compass will successfully analyse all variables of a purchase based on the latest legislation, and will refer you to a specialist adviser in the unlikely event of a case being just too complex. Those same advisers can also provide case audit services for your historical clients. Compass will also produce CQS compliant audit trails, integrate seamlessly with your Case Management System and is intuitive and comprehensive enough that additional training for your staff will be measured in a matter of hours, not weeks.

Call us today, and find out how we can help you tick all the right boxes.

This article was submitted to be published by SDLT Compass as part of their advertising agreement with Today’s Conveyancer. The views expressed in this article are those of the submitter and not those of Today’s Conveyancer.

SDLT Compass

SDLT Compass asks all the relevant questions before analysing deals to identify where reliefs or special rules may apply.

For standard transactions, Compass’s sophisticated algorithms provide an insured and indemnified Stamp Duty calculation of Stamp Duty Liability. For the more complex transactions, Compass ensures all the relevant information has been collected before referring the matter to our panel of experts, along with an overview of the potential issues identified to ensure that appropriate reliefs have not been missed and that the necessary conditions (including post completion conditions) have been complied with.

Compass is a one-stop application for all your SDLT needs, helping you to ensure that SDLT is calculated correctly for each of your clients first time, every time, and giving you the audit trail you need to prove it. Produce accurate SDLT numbers for your clients regardless of their circumstances or the type of property being purchased, avoiding the costs of:

  • Underestimated SDLT due to missed factors like additional properties, leading to loss of property and client dissatisfaction.
  • Overestimated SDLT leading to lengthy reclaim processes with HMRC and potential claims against your firm by the client.
  • Loss of professional reputation and higher PI insurance costs.

Compass allows your firm to avoid costly SDLT errors. It is a simple web-based interface and it is designed to produce a detailed audit trail to the specifications mandated in the latest CQS and Law Society tax guidance! Backed by 15+ years of experience, Compass analyses all 49 SDLT reliefs via 4 simple screens and provides 1 simple solution.

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