SDLTM50300 - Procedure: Adjustment where contingency ceases or consideration is ascertained FA03/S80

Where part or all of the consideration for a land transaction is contingent or uncertain special rules are provided by FA03/S51. See SDLTM05010.

Contingency

Where the return is made on the basis of a contingency, FA03/S51 provides that the return is made on the assumption that

  • the contingency will occur
  • the additional consideration will become payable

If later it becomes clear that the contingency will never occur an adjustment has to be made to the return by virtue of FA03/S80.

If the twelve-month window has not expired the purchaser should amend the previous assessment under FA03/SCH10/PARA6.

If the twelve-month window has expired a claim under FA03/SCH11A should be made.

If there are no enquiries into the amendment of the land transaction return, the stamp duty land tax payable will be adjusted and any tax overpaid refunded.

Repayment interest will be due dating back to the time the tax was paid.

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Uncertainty

Where the return was made on the basis of an uncertainty or a mixed contingency and uncertainty, FA03/S80 provides that if, when an uncertain amount is ascertained

  • more Stamp Duty Land Tax (SDLT) is due
  • the transaction becomes notifiable or chargeable for the first time

a land transaction return is due.

The return must

  • be made within 30 days from the date when the consideration is known.
  • from 1 March 2019, where a transaction becomes notifiable for the first time, the return must be made within 14 days from the date the consideration is known.
  • contain a self-assessment of the tax payable in respect of the transaction on the basis of the information contained in the return
  • calculate the tax by reference to the rates in force at the effective date of the transaction
  • interest will run from the effective date of the transaction, not the date that the uncertainty is ascertained. See FA03/S87(4)

A land transaction return where a transaction was not previously notified should be made on form SDLT1 or electronic equivalent.

For other cases where a form SDLT1 was submitted at the effective date of the transaction, a further return should be made in the form of a letter which should state the amendment required to the original land transaction return.

The further return and any payment of tax should be sent to the Birmingham Stamp Office. (address below).

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Tax previously overpaid

If in an uncertainty case the effect of the new information is that less tax is due, a claim for repayment should be made by amending the return under FA03/SCH10/PARA6 if within the twelve-month time limit and under FA03/SCH11A if outside that time limit. The amended return should be sent to HMRC Stamp Taxes. The address can be found here

Interest will be payable on the overpaid tax from the date of payment.

The provisions of FA03/SCH10 apply to land transaction returns made under FA03/S80 in the same way as they apply to a land transaction return submitted under FA03/S76.

This includes HM Revenue & Customs enquiry powers and penalties for late returns.

Enquiries can also be made into amended returns and claims under FA03/SCH11A. See SDLTM05040+