Reviewing SDLT reclaims

Our client is a high net worth individual who recently purchased a £4m home in London.

The challenge

Our client was approached by a number of stamp duty reclaim specialists saying that they had overpaid the tax and could reclaim it from HMRC. The reclaim specialists worked on a ‘no win, no fee’ basis, charging up to 20% of the overpaid tax if successful.

Reclaim specialists scan recent completion dates from the Land Registry, then, we think, make online enquiries to see if there is a potential reclaim. Reclaims are often triggered when, for example, part of the property, like a lower-ground floor flat in a large town house, is able to be used as a self-contained dwelling, or where part of the property is not used, and not suitable for, residential purposes. These conditions could make a property eligible for a partial relief.

How did Blick Rothenberg help?

Our client brought the reclaim letters to us and we examined the floorplan and photographs of the property they had purchased, giving an unbiased opinion of the merits of making a reclaim. Our research found that the grounds for a reclaim had been exaggerated by the reclaim specialists, and a reclaim would likely fail. Also, we were concerned that if our client chose to make a reclaim, the terms of the arrangement proposed by the reclaim specialists meant that their fee would be payable without a guarantee HMRC could not change their mind, potentially leaving our client out of pocket should the reclaim be overturned, which we deemed probable.

The outcome

Our client did not pursue the claim.