Paying everyone in the chain's stamp duty? Is my math's right?

[3kidsandus]

Our chain of 5 is near collapse due to a problem on our end. We are considering offering to pay the stamp duty relief that we will lose if we don't complete before 1st July.

My thoughts are we give the top chain £12500. And that then filters down the chain. This might work right??

Has anyone done anything similar?

Why is chain nearing collapse? When will issue be sorted? How much will each person in the rest of the chain lose on SDLT and how much are you expecting to filter down through the chain?

I’m not sure I understand your idea - you give someone (your buyer?) £12.5k for their stamp duty, which they pay to HMRC. How does this filter down the chain?

What’s happened your end?

I don't think you understand how stamp duty works and so would advise you against this really strongly.

The amount of stamp duty everyone pays depends on circumstances and price. I would advise you to spend some time understanding how stamp duty works before proceeding.

That's just not how it works.

Is there no way you can fix whatever the hold up is? What is it that's causing it?

From an AML perspective all monies used toward a purchase, including for SDLT/legal fees etc will need to be checked. If coming from a 3rd party (ie you) it will be classed as a gift and you would need to complete gift procedure for each transaction, if any of those have lenders that will need reporting and some lenders won't accept a gift that's not from a close family member. What's the issue that's holding you up? I don't think what you are proposing is possible. I doubt they'd be able to replace you with another buyer who's be ready in time for the deadline anyway so either way they'll probably need to pay it.

It's not going to work because legally it's just not that simple and would actually create a hell of a lot of additional paperwork and hoops to jump through.

Thank you everyone. We have to go for retrospective planning permission as our buyers solicitor unfortunately contacted the council about a planning condition that was not discharged. It was our fault we missed it. We were not trying to hide anything by any means and had all the building regs and completion certificate for the extension.

The extension more than 4 years now and we have found an insurance company that will cover if there is written confirmation that the council don't plan to enforce it. Luckily we got this in writing from the council on Friday. So need to send the draft policy to buyers solicitor to see if will satisfy them.

The top of the chain is getting impatient as this is their second chain. They think they can now make much more money from it if it goes back on the market!

My thoughts with the SDLT was that if we somehow gifted (which sounds more complicated than I thought!!) the top chain. They would reduce their price by 12,500 and this would trickle down the chain? If that makes sense.

It obviously doesn't help if you don't have the cash free to pay the SDLT within 14 days of completion! But was just a thought to try and keep the chain going.

Well let them then. It’s not your fault, it’s just a hold up. Don’t offer money that’s just daft

It really is just the most stressful thing!! I think as the market is so crazy at the moment and we've had people try to gazump us our sellers are tempted to take it back to market too to see if they can get more for it.

If the indemnity insurance route doesn't work then we have an 8 week wait for planning to come through! Such an annoyance as they have said that they will remove the condition!! But the only way it can be done is to apply retrospectively! A lawful development certificate would take longer they advised!

Thanks again everyone!!

@MrsElijahMikaelson1

Well let them then. It’s not your fault, it’s just a hold up. Don’t offer money that’s just daft

Lol!! You're right! It's heart over head isn't it?

You can deduct whatever is the value of the stamp duty from the price your buyers are paying you but if you start giving people money that opens up a whole legal can of worms! Also how on earth would it filter down?

@Hellocatshome

You can deduct whatever is the value of the stamp duty from the price your buyers are paying you but if you start giving people money that opens up a whole legal can of worms! Also how on earth would it filter down?

You're absolutely right! Can't believe I got an A in A-level maths!!!

@MotherOfWren

From an AML perspective all monies used toward a purchase, including for SDLT/legal fees etc will need to be checked. If coming from a 3rd party (ie you) it will be classed as a gift and you would need to complete gift procedure for each transaction, if any of those have lenders that will need reporting and some lenders won't accept a gift that's not from a close family member. What's the issue that's holding you up? I don't think what you are proposing is possible. I doubt they'd be able to replace you with another buyer who's be ready in time for the deadline anyway so either way they'll probably need to pay it.

My thoughts exactly about being replaced! I just think it's to get more money for it if they have to wait for us!

@milinhas

I’m not sure I understand your idea - you give someone (your buyer?) £12.5k for their stamp duty, which they pay to HMRC. How does this filter down the chain?

It doesn't! I've just switched my brain on!!

Retrospective will take a long time.

@pinkplantpotspot

Retrospective will take a long time.

Yup :(

@3kidsandus saying that, it's not impossible. I don't know how to pm on here but if you are able get in touch as may be able to help

[quote pinkplantpotspot]@3kidsandus saying that, it's not impossible. I don't know how to pm on here but if you are able get in touch as may be able to help[/quote]
@pinkplantpotspot I've just sent you a PM (I think!) Couldn't figure out how to do on the app. But on a browser there's a little profile icon and messages are in there. Any advice/help much appreciated :)