Warning to first-time buyers over Stamp Duty mistake that could cost you a hefty bill

NEW homeowners are being warned about dodgy cold calls which could leave them with a hefty tax bill.

The stark warning comes after a recent spate of Stamp Duty refund claims made to HM Revenue and Customs (HMRC) failed to meet very specific criteria.

Rogue repayment agents contact homeowners who have already paid their Stamp Duty Land Tax (SDLT), claiming they have been overpaid.

You pay Stamp Duty when you buy a house, flat or other land and buildings over a certain price in the UK.

For example, if you buy a property for £500,000 you'll pay £10,000 in stamp duty. If you buy one for £350,000 you'll pay £2,500.

It's not a popular tax, and can add thousands of pounds to the cost of buying a house.

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So it's not surprising that homeowners targeted by these fraudsters are pleased to hear they might be due some money back.

Rogue repayment agents promise to put in a claim for an SDLT relief refund on your behalf – and take a fee for the service.

But when the HMRC checks the claims, it notices householders are not due a refund and claims back the money.

HMRC operates a "process now, check later" rule, which means it can check claims even after a refund has been made.

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SDLT is a self-assessed tax, so even when making an amendment to reclaim tax it is the responsibility of the taxpayer to get it right.

If the claim is wrong, the taxpayer will be liable to pay 100% of the tax refund back, including the cut a rogue tax repayment agent may have taken, with interest.

Penalties may also be charged if the taxpayer is found to have acted carelessly or deliberately.

One homeowner was told by scammers they had overpaid Stamp Duty by £60,000, but managed to flag it to HMRC.

The agent claimed the home could be designed as two properties despite it being one.

Nicole Newbury, HMRC director for wealthy and mid-sized business, said: "We are seeing obviously spurious refund claims that are never going to succeed; but will lead to an unnecessary bill for the customer.

"So we are warning new homeowners not to get caught out by tax repayment agents promising easy money on a 'no win, no fee' basis.

"If it sounds too good to be true, it probably is."

What to do if you've been scammed?

Anyone approached about a Stamp Duty refund claim should check with their original conveyancer.

Take independent professional advice and check HMRC’s guidance by searching "Stamp Duty Land Tax" on GOV.UK.

You can also contact HMRC's helpline on 0300 2003 510.

Don't be pressured into making a decision by a cold-caller – if in doubt, hang up and give yourself some time to think.

Citizen's Advice is also valuable resource.

If you've been scammed, you need to:

  • protect yourself from further risks
  • check if you can get your money back
  • report the scam

You can use Citizen Advice's online scams helper to get advice which is specific to you.

The most common types of fraud

Fraudsters in the UK stole a whopping £753.9million in the first half of 2021.

That means criminals walked away with over four million quid in stolen money every single day.

The Sun revealed the most common types of fraud back in October last year.

They were:

  • Unauthorised payment card fraud
  • Remote banking fraud
  • Investment scam
  • Impersonation: Police/bank staff
  • Impersonation: Other
  • Invoice and mandate scams
  • Purchase scam
  • Advance fee fraud
  • Romance scam

Three ways to recognise a WhatsApp scam

And last month a British scam expert highlighted the key signs that a scammer is targeting you on WhatsApp.

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Speaking to The Sun, scam-buster James Walker revealed three giveaways that a WhatsApp message is fishy, which were:

  • A sense of urgency
  • Friends and family asking for money
  • Something feels fishy

It came with phoney messages sent by crooks on the rise in the UK.

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