Posted 03rd March 2023 by ctatax-admin
Common Sense from Cornerstone Wins Again
“Not every case goes to Court just because HMRC disagree
As the leading experts on Stamp Duty in the UK, we like to make sure we put our money where our mouth is, and a recent victory for one client illustrates not only the lengths to which we will go in order to defend our positions, but also the benefit of our extensive expertise in avoiding costly and often lengthy proceedings before the Tax Tribunal.
In this particular case, we had identified that our client’s purchase, of over 40 acres, had been mis-classified for Stamp Duty purposes as residential instead of mixed-use. This then resulted in an overpayment of Stamp Duty totalling nearly £250,000!
We duly wrote to HMRC on the client’s behalf, explaining why the original payment had been incorrect and submitting a amended return for approval and a refund to the client. HMRC’s (predictable) response was to deny the refund claiming the land was “wholly residential”. This despite the land containing all the features normally associated with agricultural as well as residential activity.
Thus, we were forced to engage in the Tax Appeals process with HMRC on the client’s behalf.
Before going to the Tribunal Hearing, this largely involves the exchange of technical correspondence between our own experts and various people at HMRC, whose job is mainly to try to prove us wrong – something that they don’t manage all that often. In this case, at the final stage – when HMRC lawyers get involved (and surprisingly they don’t do this earlier) HMRCs lawyers agreed with us and after nearly 4 years of “to and fro” argument, HMRC withdrew their case and instructed the Tribunal to close its file on the matter.
Our happy client will now receive his refund.
“This result is not at all surprising, In fact, we estimate that as many as 95% of the cases we handle never even get to the dispute/appeal stage. Of the remaining 5%, many never to an actual Tribunal hearing in Court.
What is however disturbing is the time taken for the case to reach someone inside HMRC who had the authority (or common sense) to realise that the claim was perfectly valid and drop the case. It points to a lack of experience or, worse, a degree of dogmatic behaviour by case officers deliberately designed to frustrate taxpayers claiming their due.”
Overall, it’s a great example of the benefits of using Cornerstone for your Stamp Duty needs. Not only did our client get his refund – which he would never have been aware of in the first place without our help – but he also avoided the frustrating grind of corresponding with HMRC for several years as they tried to find a way to get out of paying what was due.
All too often, it feels like common sense doesn’t prevail. Happily, when you’re a Cornerstone client, the odds are very much in your favour that it will.”