From 1 March 2019, homebuyers and property investors must lodge and pay their stamp duty land tax (SDLT) bill within 14 days from completion.
Failure to pay stamp duty land tax on time will result in a £100 fine. This fine increases to £200 if payments are more than three months late.
The reduced stamp duty payment period is applicable to all land, and freehold and leasehold properties purchased in England and North Ireland.
This new rule is not applicable to Scotland and Wales. Instead of stamp duty, the Land and Buildings Transaction Tax (LBTT) and the Land Transaction Tax (LTT) is paid in Scotland and Wales.
The 14 days of the payment period is inclusive of Saturdays and Sundays.
Paid to the HMRC, stamp duty is a property transaction tax. The land tax threshold for residential property purchases is £125,000. The threshold for non-residential property and land is £150,000.
Cash buyers and foreign investors must also pay stamp duty land tax.
First-time homebuyers may, however, be exempt from paying the SDLT. Exemption rules change frequently, so check the HMRC website for the latest eligibility criteria.
HMRC insists that most homebuyers and investors lodge and pay the SDLT bill within 14 days. Hence, a reduction in the payment period improves the efficiency of processing applications.
However, most SDLT returns are lodge by conveyancers, on behalf of homebuyers and property investors. To prevent delays, documents must now be collected, prepared and submitted earlier.
Conveyancers may request that buyers and investors pay their stamp duty land tax bill before completion.
So, what are your thoughts on the reduced stamp duty land tax payment deadline?