Overview
At Compass, we partner with conveyancing firms to protect their clients, reputation, and compliance by ensuring Stamp Duty Land Tax (SDLT) is calculated correctly every time.
In this recent case, a solicitor sought our guidance on a transaction where there was uncertainty over whether the 5% higher rates for additional dwellings applied and how an assumed mortgage should be treated in the chargeable consideration.
The Challenge
In this instance, two complex factors required clarification:
- Whether the transaction should be subject to the 5% higher rates of SDLT.
- Whether a £35,000 assumed mortgage formed part of the chargeable consideration.
Both points carried implications for the firm’s PI exposure and reputational risk if SDLT was incorrectly calculated.
Our Approach
We conducted a full technical review and discussed the findings directly with the solicitor, providing clear reasoning and evidence to support the calculation.
Our role was to act as an extension of their team, offering expertise and saving valuable time fee earner time. This collaborative approach ensured the solicitor could move forward confidently, knowing the SDLT calculation would withstand HMRC scrutiny.
The Outcome
We confirmed that the transaction was not subject to the higher 5% rates and that the assumed mortgage should indeed be included in the chargeable consideration.
By aligning the figures and rates correctly, the SDLT due was £1,523 – rather than £5,890 if the higher rates had been applied to the incorrect consideration. While the client benefited from the correct outcome, the solicitor benefited from avoiding a potential insurance claim and demonstrated clear due diligence.
Key Results
- Avoided PI exposure through independent SDLT verification
- Saved fee earning time by engaging with Compass
- Preserved client trust with a compliant and confidently supported return
- Identified £4,367 in potential overpayment – proving the value of early specialist involvement
Conclusion
This case illustrates how Compass helps law firms manage SDLT complexity while protecting their professional standing.
By offering precise, expert insight and collaborative support, we provide firms with confidence that every SDLT calculation is correct – safeguarding their clients, their reputation, and their peace of mind.
