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David interviews Julie White – Property Tax Expert – SDLT have you overpaid?

In this episode we are delighted to Welcome Julie White from Cornerstone Tax to the Podcast

Julie is a Chartered Accountant who has specialised in Tax for the last 30 years and specifically Property Tax since 1999. She has worked in a number of large accountancy firms from Pannell Kerr Forster in Nottingham where she trained, to KPMG in Nottingham, Arthur Andersen in Cambridge and London and more latterly at RSM UK in Nottingham and EDF Tax in Nottingham.

Julie began to specialise in property tax when she moved to a client of Arthur Andersen  a FTSE 100 company British Land where she began to specialise in property tax and particularly SDLT. She has since advised many entrepreneurial businesses with regard to minimising their tax position.

Julie began working with Cornerstone Tax earlier this year.  Cornersrone are a niche property tax consultancy founded in 2006, with a particular focus on Stamp Duty Land Tax, SDLT as it most commonly referred to in the tax world. Cornerstone has grown to become the leading firm of Chartered Tax Advisers in this field.

Cornerstone advise solicitors on how to calculate the SDLT liability on individual transactions as the SDLT legislation has become increasingly complex over recent years and the rates have, of course, increased significantly. Cornerstone also advise individual property investors, property purchasers, property portfolio holders, entrepreneurial property business owners and corporate entities to maximise their tax efficiency when it comes to purchasing property and holding it in a tax efficient environment. Much of Cornerstone’s recent work has centred around assisting clients in forensic reclaims of overpaid SDLT on historical transactions and helping clients minimise the SDLT paid on current property purchases.

Cornerstone are based near Market Harborough, with a particular strength therefore in the East Midlands, but are a national practice and have clients all over the UK and internationally.

  • Who are Cornerstone Tax
    We are a niche property tax practice based in Kibworth near Market Harborough, dealing with all property tax issues but with a particular focus on Stamp Duty Land Tax (SDLT)
    We were founded in 2006 by David Hannah who is a Chartered Tax Adviser with experience in property tax matters and SDLT.
    We have a team of Chartered Tax Advisers, Chartered Accountants, Tax Consultants’ and Tax Technicians with many years experience in dealing with property tax issues.
  • –  How can Cornerstone help those who buy or hold property?
    Our team can advise individual landlords, property investors, property developers, property partnerships, and companies on how to plan effectively to minimise all taxes relating to transactions involving property. This could be property purchases, the restructuring of holding property portfolios, transferring properties between individuals and other entities, transfers of properties between family members or leaving assets such as property for future generations.
  • –  What is Stamp Duty Land Tax or SDLT?
    It is a tax based on the percentage of a price paid for a property or its value if transferred between parties. It is paid for by the purchaser of a property.
  • –  How much is SDLT?
    The current tax is structured based on a “stepped” system whereby a buyer now pays a fixed percentage for each “slice” in value of a purchase up to a total amount. On residential property if the purchase price is:
    < £125K = 0%
    £125K – £250K = 2%
    £250K – £925K = 5%
    £925K – £1.5m = 10%
    >£1.5m = 12%
    For companies owning a residential property 15%

So a residential property costing £750K, the SDLT would be £27,500 (£125K@2%+£500K@5%One costing £1.5m the SDLT would be £151,250.

On non-residential (commercial) property Up to £150K = 0%
£150K-£250K = 2%
>£250K = 5%

  • –  Current status of SDLT
    SDLT is a tax that used to be a relatively insignificant tax to the Treasury, but in these days of challenging economic conditions, there is a perception that those who own property, rightly or wrongly, are doing well relative to many others.

Since the introduction of Stamp Duty Land Tax in 2003 when the tax was split away from Stamp Duty (which is a tax on the purchase or transfer of shares), the rates have increased steadily, to those that we see today with a top rate of 12%. Gone are the days when buying a property meant an irritating 1 or 2% on the mortgage.

SDLT currently generates more than £13bn of tax receipts a year. That’s more than Capital Gains Tax of £7.9m and Inheritance Tax of £5.2m and almost a quarter of what UK Corporation tax brings in at £54bn. So SDLT has become something of a stealth tax since its inception in 2003 and certainly one where buyers need to take notice in order to minimise their liability.

What are the current hot topics specific to SDLT?

There are a few things I want to focus on:

  1. The increasing complexity of the SDLT legislation is leading to a situation where there are huge overpayments of SDLT made by purchasers. This shows that the SDLT legislation is, indeed, far too complex even for most conveyancing solicitors who act almost as unofficial tax collectors for HMRC. Solicitors are not tax advisors but the sheer complexity of the legislation is leading to fundamental errors in the calculation of SDLT on property transactions. The SDLT Tax calculator on the HMRC website is not fit for purpose as it asks a handful of basic questions, which does not delve deep enough into the circumstances of a transaction to ascertain whether any of the plethora of the SDLT tax reliefs that exist might be available to a taxpayer to reduce their SDLT liability. According to HMRC figures refunds of, £111m were made in the first 3 months of 2018 and £80m in the second 3 months of 2018. This compares with £47m in the last 3 months of 2017 and £57m in the 3 months before that. An increasing trend and worrying for all property purchasers who don’t know if they are paying the right amount of SDLT. We at Cornerstone estimate that as many as 1 in 6 transactions may have overpaid SDLT and estimates are that as much as £2bn a year in SDLT is overpaid.
  2. As if to highlight the fact that property owners are being targeted by the Government for increasing tax receipts, the SDLT Additional Rate tax of 3% was introduced back in 2016. The Additional Rate of SDLT is due on residential property purchases (the legislation talks about dwellings), which are second homes or buy to let properties, whether they be for investment purposes or a taxpayers’ main residence if they still own another residence. For the last year, Additional Rate tax transactions accounted for 24% of all liable transactions, so it has raised a significant amount of additional revenue receipts for SDLT since its introduction.
  3. In the last couple of years as a result of changes to the deductibility of finance costs (interest on mortgages) for landlords introduced by s24 FA (no.2) 2015 (which we will discuss more fully later on), there have been significant moves on

the part of landlords and owners of buy to let properties to incorporate their property businesses if they operate as sole traders or in partnership. Moving properties into a company, even where technically there has been no change of ownership if the current owner is also a shareholder in the company, will result in an immediate SDLT liability.

  • –  How has the introduction of the SDLT Additional Rate surcharge of 3% affected property purchases and the property market generally?

The 3% additional rate surcharge applying to the purchases of second homes and but to let dwellings has had an impact on the buy to let market. Many landlords and property investors have taken the view that the increased burden of SDLT taken together with the restriction on the tax deductibility of finance costs are abridge too far in the investor property market. There is simply not enough profit on rents to make a property letting business viable. This has led to the offloading of an increasing number of buy to let properties on the market, with less uptake from buy to let investors. This has inevitably led to a depression of market prices in some parts of the country.

  • –  How can purchasers find out if they have overpaid SDLT and what happens if they have?

Much of the work that Cornerstone have undertaken for clients in the last couple of years has involved ascertaining whether clients have overpaid SDLT and obtaining refunds for them.
Some examples of cases we have worked on recently:

  1. A client overpaid £28K on the purchase of a residential home for £850K
    2. A developer client obtained a £128K refund when purchasing land with planning permission to build 18 dwellings

Cornerstone can assist clients who have purchased properties in the last four years (the time period in which a refund can be claimed), by carrying out a forensic review of all transactions to ascertain if any reliefs are available to reduce the SDLT that should have been paid.

The things to look out for in particular are properties with:
(i) Land over half a hectare (1.24 acres)
(ii) Any commercial or non-residential buildings on the land ie.stables, workshops etc
(iii) Annexes, flats, cottages in the grounds
(iv) Any rights over or interest in land that does not benefit the dwelling ie.

(v) Common rights to wander over nearby parkland that may or may not be in the title

  • –  What are the implications for landlord and property owners on the introduction of s24 FA(2)2015 Landlord Tax? How has this affected the property investment market?

The introduction of this provision in April 2017 is being phased in gradually where the tax relief available on mortgage interest to set against income received on property is being reduced. The provision is phasing out higher rate relief for mortgage interest for property investors and only basic rate relief could be claimed. So for most property investors who are higher rate taxpayers, this means effectively a reduction of 20% on what they can claim.

For many property investors, the effect of this provision combined with the tightening of the rules regarding claiming a tax deduction for expenses like maintenance and decoration, has made it not as efficient or profitable investing in property.

It has led to many property investors deciding to offload their portfolios or to incorporate their property investment business, as a corporate vehicle can continue to claim full tax relief for property finance costs.

  • –  What other taxes can Cornerstone advise on specific to property?

Cornerstone are a niche property tax consultancy and in addition to SDLT, they can advise on Capital Gains Tax, Inheritance tax, Corporation Tax and Income Tax surrounding property matters.

We advise on restructuring of property portfolios into tax efficient vehicles and to maximise wealth.

  • –  Why use Cornerstone Tax?

Cornerstone have been operating in the niche property tax sector for over 10 years and has an experienced team of Chartered Tax Advisors, Chartered Accountants, Accounting Tax Technicians and STEP (Estates) qualified consultants.

We provide straightforward, comprehensive, bespoke advice for our clients. We pride ourselves on being able to deliver efficient tax solutions for all clients’ specific circumstances.
Our bespoke services includes:

  • –  ongoing support for any tax enquiry raised by HMRC in respect of any transaction that Cornerstone has advised on
  • –  Representation of tax matters to Tribunal level
  • –  Annual reviews of your tax affairs to ensure your tax position is optimised
  • –  Transaction tax audit service for large volume purchasers, developers, property investors and dealers and/or solicitors.

You can contact Julie at Cornerstone Tax using the details and links below:


Telephone: 01858 439033


Cornerstone Tax,

Milestone House,
18 Nursery Court,
Kibworth Business Park,
Kibworth Harcourt,
Leicester LE8 0EX

You can contact us anytime using the links below:





So don’t forget to contact us with any subjects you would like us to cover or questions you would like answering in the coming episodes and until next time I would like to thank you for listening and goodbye for now.

About the author, David Thomas

David Thomas is an Entrepreneur and passionate Estate Agent who loves helping others on their property journey.


  1. Aretha on 02/28/2019 at 5:02 PM

    I was always concerned about this subject so thanks for posting.

    • David Thomas on 04/05/2019 at 12:40 PM

      My pleasure, hope it helps and thanks for listening.

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