We’ve all heard the old cliché about locking stable doors after the horse has bolted, but what if you haven’t even built the stable before your equine friend has vanished into the distance?
That’s what it can feel like when you’re dealing with a property transaction and problems crop up at the last moment. That’s why the first things you’ll do on instruction are AML checks, ID checks, searches and title checks. The last thing you want is a hitherto unrevealed coal mine or charge against the property rearing its head on the day of exchange.
And yet, when it comes to Stamp Duty, many firms are leaving themselves open to a similar level of risk. Over the years we have seen examples of firms misunderstanding the rules around the 3% second residence surcharge, leading in some cases to the transaction falling through and in others to clients desperately scrambling to borrow more money to cover the liability.
We’ve seen missed Multiple Dwellings Relief, Mixed-Use and other elements that would have significantly reduced the client’s Stamp Duty bill. Now, we have the 2% Non Resident Surcharge, itself unique as it applies an entirely different definition ‘residency’ to any other area of UK legislation, and it seems likely that this too will cause some confusion.
A recent interaction we saw between an accountant and a solicitor on a case where we were involved late on in the process handily illustrated the issue. Phrases like ‘As accountants we are certainly no SDLT experts’ and ‘I am not providing this as a certain answer but more to indicate that this needs to be checked over and confirmed by someone who deals with SDLT regularly and has experience with linked transactions’ make for sobering reading for clients assuming their solicitor and/or accountant should simply have this part of things under control.
We were able to resolve that case successfully, though the lateness of our being consulted meant additional stress and needless pressure on all parties. Had the solicitors simply been using Compass Concierge from the start, none of that would have been necessary.
And that’s without considering the other benefits of using our service – reduced risk, lower PII premiums and the availability of expert advice for clients at any point in the process. All things considered, why wouldn’t you use us?
