HMRC warns home buyers about bogus stamp duty repayment claims

Home buyers are being warned by HM Revenue and Customs (HMRC) to avoid false claims about stamp duty.

The revenue body said it is actively pursuing agents who make false stamp duty land tax repayment claims.

Some agents have suggested that, for a fee, they can reclaim stamp duty the buyer has already paid by saying the property is non-residential because it is uninhabitable, HMRC said.

It warned making claims of this kind often leave the homeowner liable for the full amount of stamp duty, plus penalties and interest.

HMRC said its long-standing view is that if a property requires repairs but retains the fundamental characteristics of a home, it is still suitable for use as a home and attracts residential rates of stamp duty.

A key factor in determining suitability is whether a property was previously used as a home, it added.

HMRC said it is using civil and criminal powers to deal with those who undermine the tax system.

Anthony Burke, HMRC’s deputy director of compliance assets, said: “Home buyers should be cautious of allowing someone to make a stamp duty land tax repayment claim on their behalf.

“If the claim is inaccurate, you could end up paying more than the amount you were trying to recover.”

Stamp duty applies in England and Northern Ireland.

Anyone who is unsure of the rules should check the stamp duty guidance on gov.uk, HMRC said.