Business tax – guidance

Stamp Duty Land Tax: online returns

Stamp Duty Land Tax (SDLT) deadlines, who must send a return, penalties, corrections and pay your tax bill.

SDLT no longer applies in Scotland. Instead you pay Land and Buildings Transaction Tax when you buy a property.

Deadlines

You must tell HM Revenue and Customs (HMRC) about most UK land and property transactions on an SDLT return. This must be within 30 days of the ‘effective date’ of the transaction, even if you don’t owe any tax. The payment deadline is the same as for the return. You can pay any SDLT as soon as you’ve submitted your return.

The effective date

The effective date is usually the date the transfer is completed. But it can be the date the contract is ‘substantially performed’ if this is before completion. ‘Substantial performance’ is when one of the following happens:

  • most of the buying price is paid - normally 90% and payment can be in cash or something else of economic value
  • the buyer is entitled to possession of the property
  • the first payment of rent is made

You’ll pay a fixed penalty if you file your return late.

Who must send a return

You must tell HMRC about land and property transactions on an SDLT return. Some land and property transactions are exempt from SDLT and don’t need to be put on an SDLT return. These include:

  • transactions where no money or other payment changes hands
  • property left to you in a will
  • property transferred because of divorce or civil partnership dissolution

You must tell HMRC about all other land and property transactions on an SDLT return.

Most people use a solicitor or legal conveyancer to act for them, but it’s the buyer’s responsibility to tell HMRC and pay any SDLT you owe.

If you’re acting on the buyer’s behalf, you can submit your return online and pay any tax due once you:

  • have their authority on record
  • know the effective date of the transaction

Paper returns

If you need to send HMRC a paper return, for example, because you’re not represented by a solicitor or an agent, you must use the paper return - fill in the SDLT1 return form.

Send HMRC your return online

Log in to your online account to send your SDLT return to HMRC.

You can go back to a return you’ve already started.

Use the user ID and password you got when you registered for Stamp Taxes Online or when you set up your online account.

When you submit your return, you’ll get an SDLT5 certificate which will have a Unique Transaction Reference Number (UTRN). Print this and post it to the Land Registry with your application for registration.

You can use the HMRC free service or there’s a range of commercial software providers you can choose from.

If you use the HMRC Stamp Taxes Online service, you must fill in and file the SDLT return electronically. HMRC reject returns that are filled in electronically but printed and posted, or printed and filled in by hand.

Add extra details to an electronic SDLT certificate

The electronic SDLT5 certificate will show details of the first property address for any transaction. If there are multiple addresses, or more than one seller or buyer, from the ‘View, print and store’ section of the online SDLT return, print a PDF version of forms:

  • SDLT2
  • SDLT3
  • SDLT4

Send these to the Land Registry by post together with a copy of the electronic SDLT5.

Save a copy of the return and the certificate and keep a record of the UTRN for every transaction.

Transactions with large numbers of properties, sellers or buyers

If you’re dealing with a transaction that has a large number of properties or there are multiple sellers or buyers, you can still file your return online.

You can enter a maximum of 99 entries (any combination of buyers, sellers or properties). When the system tells you that you can’t add any more, give the additional details separately on a schedule with details relating to each additional property, seller or buyer - include the UTRN number. Send your schedule to the Birmingham Stamp Office.

Penalties if you file or pay late

If you don’t file your SDLT return by the filing date, you’ll pay an automatic fixed penalty. The amount of the penalty depends on how late you file your return.

If you file it:

  • within 3 months after the filing date the fixed penalty is £100
  • more than 3 months after the filing date the fixed penalty is £200

If you don’t file your SDLT return within 12 months after the filing date you’ll pay a tax-based penalty as well as the fixed penalty. The tax-based penalty can be up to the full amount of the tax due on the return.

Appeal against a penalty

Appeal against a penalty if you couldn’t file your SDLT return by the deadline because of an unusual event that was either unforeseeable or beyond your control. HMRC will only accept that you had a reasonable excuse for not meeting the deadline if this event prevented you from either:

  • filing the return yourself
  • making arrangements for someone else to file it

Interest charges

You must pay any SDLT due within 30 days after the effective date of the transaction. If you pay the tax late, you’ll pay interest from the day after you should have paid it until the date when you actually pay it.

If you don’t pay the tax due on the transaction by the deadline, HMRC will send you a letter telling you about your underpayment. They send this to both the buyer and their agent and it tells you how much tax you’ve underpaid and how much interest you’ve been charged so far.

You should pay the tax and the interest as soon as possible.

HMRC uses the official rate of interest set by HM Treasury to work out how much interest you’ll have to pay. They’ll charge interest if:

  • they haven’t received your payment of the tax due
  • there’s no evidence to show beyond reasonable doubt that you sent your payment when you filed your SDLT return

You can’t appeal against a late payment interest charge

Interest charged on tax isn’t a penalty so you can’t appeal against it. It’s a charge to compensate HMRC for not having the money when they should have so you must pay it.

If you believe that the lateness is due to an HMRC action, write and explain why you think that HMRC’s actions caused the late payment. Include any supporting evidence with your letter.

If you don’t think you should pay interest, think you’ve been charged too much, or want a full interest breakdown, write to:

The Finance Team
Birmingham Stamp Office
9th Floor
City Centre House
30 Union Street
Birmingham
B2 4AR

If you made a mistake on your return

Correct an SDLT return within 12 months of the filing date

If you made a mistake when you filled in your SDLT return, you’ve 12 months after the filing date to amend it. You can correct some minor errors by post or by phone . For other more substantial errors, for example, where the underlying identity of any buyer or the property details needs changing or where the new effective date is after the date of notification, you must:

  • file a new return with the correct information
  • write to Birmingham Stamp Office giving reasons for the new return and quote the UTRN of the incorrect and correct returns.

Amend by post

Write to Birmingham Stamp Office and explain what you want to amend. Include a copy of your SDLT return. The Stamp Office will write back confirming the amendment and tell you if you need to take any further action.

Amend by phone

Call the Stamp Duty Land Tax helpline and give your UTRN to the adviser. Tell them what to correct. If they can’t make the amendment over the phone, or if a repayment is due because of your amendment, they’ll tell you what to do next.

If the amendment means you paid the wrong tax:

  • if you’ve paid too much, you can ask for a repayment
  • if you’ve not paid enough, pay the amount you’ve underpaid right away - you pay interest on this from the filing date, when the tax was originally due

HMRC can make an enquiry into your amended return up to 9 months after you’ve made an amendment. If you got a repayment but the amount you were repaid wasn’t due, you must pay it back.

Amend a return when HMRC open a formal enquiry

You can still amend your return after HMRC has started to make an enquiry but your amendment can’t take effect until after the enquiry is finished. If, at the end of the enquiry, HMRC find that your return is incorrect you’ll be told how to amend it. HMRC will take into account any amendment you’ve already asked for.

If you’ve sent a return in error or sent a duplicate return

If you send a return for a transaction that doesn’t need a return or a duplicate return, write to Birmingham Stamp Office to ask them to disregard it.

Include the following information:

  • the UTRN
  • the reason(s) why they should disregard the return
  • whether you’ve used the SDLT5 certificate to register the transaction

If you’ve filed an unnecessary or duplicate return and incurred a penalty charge that you want to dispute, appeal in writing. This must be within 30 days of the date on the penalty notice.

If you’ve made a mistake on your SDLT return that’s more than 12 months old

HMRC Stamp Taxes can amend a buyer’s name, but can’t make any amendments that change either the underlying identity of any buyer or the property details.

You can’t correct other mistakes on your SDLT return more than 12 months after the filing deadline. You may still be able to claim a refund if the mistake means you’ve paid too much SDLT.

To ask HMRC to amend a return older than 12 months write to Birmingham Stamp Office explaining what the error is, how it arose and include a copy of your original return.

Claim a refund

The deadline for claiming back tax you’ve overpaid is 4 years from the effective date of the transaction. This is usually the completion date.

Claim the refund by writing to Birmingham Stamp Office. Quote the UTRN and include a copy of the original SDLT return with your claim and:

  • explain why you think you’ve overpaid
  • say what parts of the SDLT return were wrong
  • give revised figures

HMRC will pay the refund to you unless you write to give your permission to pay it to someone else, eg your solicitor or agent.

If you’ve underpaid SDLT

If you’ve underpaid SDLT tell HMRC as soon as you realise. If you don’t, you may have to pay a penalty. You’ll normally have to pay interest on any SDLT you pay late.