Since 1st March 2019, a SDLT return must be sent to HMRC and taxes paid within 14 days of completion. Penalties and interest may be levied if the return and payment are not filed within 14 days of completion.
Daniel Kennedy, partner at Shoosmiths, said: “We anticipate this shortening of the SDLT filing and payment window will present a considerable practical challenge to conveyancers and their clients.’’ The 14 days time period include non-working days and this shorter window will add to the pressure to act quickly and may increase the likelihood of mistakes.
Redbrick Solutions Conveyancing Case Management can save a significant amount of time with quick and easy SDLT e-submissions. Data captured throughout the case is automatically populated onto the SDLT form, avoiding the risk of errors in re-keying information. Approximately 90% of the form will be pre-populated, with the system highlighting areas where further information is required. The ‘Submit’ button will only become available once the minimum required information has been added. Submissions and returns are managed easily from within the system, showing you which cases are outstanding and storing returned SDLT5’s.
Practical impact
In most cases, the SDLT return for a transaction will be prepared by the conveyancer who will also arrange for payment of the tax to HMRC. Kennedy said in a guidance note: “It is common practice in residential conveyancing for the SDLT return to be prepared in advance of completion to ensure that the conveyancer is in funds to pay the SDLT on completion. Best practice will now dictate that the SDLT return is prepared and authorised prior to completion, with the taxpayer funding its conveyancer to pay the tax at that time. Based on current practice, this will require a significant change in behaviours on the part of both taxpayers and conveyancers.”
Redbrick Solutions Conveyancing Case Management can assist with these challenges as it provides fully customisable workflows and auto-populates SDLT forms avoiding the risk of errors and saving valuable time for our clients. Exception reports can be automatically run in the background to ensure no submission or payment deadlines are overlooked. This is great from a risk and compliance point of view as it eases the burden of timescale changes for conveyancers and minimises the risk of heavy fines being imposed.