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SDLT filing and payment window reduced to 14 days

The time limit for filing a stamp duty land tax (SDLT) return and paying the tax has been reduced from 30 days to 14 days in respect of land transactions in England with an 'effective date' on or after 1 March 2019.06 Mar 2019

The effective date will usually be the date the transaction is completed but can be earlier if a contract or agreement for lease has been 'substantially performed' at an earlier stage. This can happen, for example, where a tenant is allowed into occupation, perhaps to carry out fit out works, before the lease is completed.

“The shortening of the filing window to 14 calendar days means that SDLT calculations and draft returns should be prepared as soon as possible during a transaction so that they are ready to be filed quickly after the effective date,” said Andrew McCarthy, a property tax expert at Pinsent Masons, the law firm behind Out-Law.com.

"Returns are submitted with a declaration for and on behalf of the taxpayer that the contents are correct so companies may want to consider having multiple signatories so as to cover holiday periods," he said.

The reduction in the time limit was first announced in the 2015 Autumn Statement and was originally due to come into force in the 2016-2017 tax year. However, following a consultation on the proposals in 2016, the government decided to delay the introduction of the shorter time limit so that simplifications could be made to the information required on the SDLT form in respect of complex transactions and property subject to leases. Additional information is collected by HMRC in the SDLT return on behalf of the Valuation Office Agency. New less detailed SDLT forms apply from 1 March in respect of leases, multiple properties and complex transactions.

Where further returns have to be filed, such as where uncertain consideration becomes ascertained or where a fixed term lease continues beyond its original term, the 30 day limit will continue to apply. The 30 day limit will also continue to apply to applications to defer payment of SDLT for contingent or uncertain consideration.

If returns are not filed by the due date, a £100 penalty becomes payable, if the return is filed within 3 months of the filing date. Thereafter a £200 penalty becomes payable. Interest is also payable on SDLT which is not paid on time.

SDLT only applies to transactions relating to land in England. For land in Scotland land and buildings transaction tax applies; and land and buildings tax covers land in Wales.