Beat the Stamp Duty deadline – essential tax advice
Friday 13th November 2009
Tax experts Baker Tilly have clarified that buyers may still be able to beat the Stamp Duty deadline even if they have not completed.
The current Stamp Duty holiday ends at midnight on December 31, when the threshold will go back down to £125,000.
Whilst Baker Tilly says that completion of the sale by the deadline will mean escaping the new levy, it is not the only means.
The firm says that what matters is the date of ‘substantial performance’, ie when the contract is actually implemented. Usually that date will be the date of completion, but that is not the only way in which a contract can be substantially performed. Substantial performance happens on the earliest of:
* completion;
* the purchaser taking possession the property; and
* payment or provision of at least 90% of the purchase consideration.
Of course, the practicalities of persuading a vendor to allow possession of the property before completion might be insurmountable, but it is at least worth bearing in mind.
In practical terms, says the firm, buyers generally need to be aiming to ensure that completion will take place no later then December 31: effectively, this means that most buyers who do not reach exchange of contracts before the end of November could have great difficulty completing in time.
It could be a busy two weeks ahead for agents!
http://www.estateagenttoday.co.uk/News/Story/?storyid=2554&title=Beat_the_Stamp_Duty_deadline_%E2%80%93_essential_tax_advice&type=news_features
