Is Stamp Duty Land Tax on Homes Always Necessary? - By: Wesley Lawson

Stamp Duty Land Tax - all of us hate paying it on real estate transactions, however, you have to. Or does one? Tax avoidance scheme promoters charge a considerable fee but may completely eliminate SDLT payable to the HMRC. The HMRC naturally aren't happy with this and they're issuing propoganda weekly as a measure to lessen this avoidance technique. Effective SDLT Schemes are targeted and so are intermediaries and players in the field, such as the CML, mortgage providers, as well as the SRA. Schemes are accessible for cash buyers, mortgage buyers, limited companies, UK individuals, husbands and wives, unmarried partners and UK trusts.

The HMRC are having a supposed crackdown on SDLT avoidance. They have apparently been investigating past land transactions and apparently have been utilizing the land registry's computer system to identify likely transactions. In some cases, usually where the scheme provider made mistakes or simply didn't implement tax avoidance in any way, they have been successful. One such scenario resulted in the solicitor involved being struck off, and the SRA compensated all the clients involved to the full extent of the SDLT. The reality is the loopholes exist in the law. The HMRC has been astonishingly unsuccessful in actual fact in challenging Stamp Duty Land Tax avoidance within the courts - or rather the First Tier Tax Tribunal. Their best weapon is propoganda, and let's face it, it works. Providers are already complaining that business is down purely because of it. Newspaper reports, blogs, and threats to the CML and SRA are increasingly being effective. They particularly enjoy threatening retrospective legislation but it is never going to happen.

They might consider changing the legislation, but on balance, it's probably not worth it for them. Changing legislation is spectacularly tough and time-consuming, and who's to say they'll draft it any better next time? On paper, they can "shut down" SDLT schemes, but Goodhart's Law suggests that for every scheme shut down, another one enters into existence. The HMRC have clearly taken the view that they don't need to bother - they're just scare-mongering and utilizing propoganda, plus attempting to take the ethical line. They don't mention that the government itself were complicit in the biggest ever Stamp Duty Land Tax avoidance transaction when disposing the Chelsea Barracks.

About the Author

I'm a self-employed tax consultant specialising in SDLT avoidance. I studied at Oxford in the early 1980's, and worked at different major companies during the 80s and 90s in accountancy and investment banking. In 2005 I set up in business helping people mitigate a variety of taxes.

Can Stamp Duty Be Avoided?, Article Directory Source: http://www.articlerich.com/profile/Wesley-Lawson/230962

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