Claiming MDR Relief
MDR Relief
If you are buying, a HMO, or a property with any separate, self-contained dwelling, which could be an area of the property, with its own bathroom and facilities, all behind one door, you could save a lot of money, by claiming MDR relief.
If you have bought one within the last three years, you could possibly claim back this over payment, but how does it work.
Let’s take a property priced at £1M, the SDLT would be as follows:
| £0 to £250,000 | @ 0% | £0 |
| £250,000 to £925,000 | @ 5% | £33,750 |
| £925,000 to £1m | @10% | £7,500 |
| Total SDLT | £41,250 | |
| SDLT Surcharge | @3% | £30,000 |
| SDLT Grand Total | £71,250 |
Claiming MDR relief for 4 dwellings
| £0 to £250,000 | @ 0% | £0 |
| SDLT Minimum | @ 1% | £2,500 |
| Four Units | @£2,500 | £10,000 |
Total saving using this method is a whopping £61,250
Apply for a repayment of the non-UK Resident Stamp Duty Land Tax surcharge
Check if you can and how to apply for a repayment if you’re a non-residential purchaser of property in England and Northern Ireland.
Who can apply
You or your agent can apply for a repayment of the surcharge paid on a property if all the purchasers are individuals and have spent 183 days in the UK in any continuous 365-day period:
- starting no more than 364 days before the effective date of transaction
- ending no more than 365 days after the effective date of the transaction
The effective date of the transaction is usually the completion date.
You must apply for the repayment within 2 years of the effective date of the transaction.
What information you’ll need
You will need the:
- UK bank account and sort code details for the person to receive the payment — this is where the refund will be paid and can be in sole or joint names
- Unique Transaction Reference Number (UTRN) of the Stamp Duty Land Tax return submitted when the property was purchased
- effective date of the purchase of the property, usually the completion date
- amount of Stamp Duty Land Tax paid on the property, including the non-resident surcharge
- purchase price, if it’s a freehold property (or other ‘consideration’ if the transaction included goods, works, services, debt release and so on)
- total lease premium, if it’s a leasehold property
- ‘net present value’ calculation used when the Stamp Duty Land Tax was calculated if it’s a new lease
If you’ve already reclaimed the higher rate on additional dwellings, you’ll need the amount of Stamp Duty Land Tax that was due after the refund.
You may need to ask the solicitor or conveyancer used for the purchase for most of these details.
If you are an agent acting for the purchaser
You’ll need a document signed by the purchaser confirming that you have authority to apply for a repayment on their behalf. You can use this .
If the repayment is to be paid into an account other than the purchaser’s, the document must authorise this and include the account details.
You’ll need to upload an image of the signed document and include it in your online application.
How to apply for a repayment
Your application is a request to HMRC to amend the Stamp Duty Land Tax return for the property. You’ll be asked to certify that the amendment is correct.
There are 2 ways to apply depending on whether or not you have a Government Gateway user ID and password. You should use either your:
- Government Gateway user ID and password, you’ll have these if you’ve registered for Self Assessment or filed a tax return online
- email address
You’ll be able to save your application and return to it later.
You can only apply by email if you do not have a Government Gateway user ID.
You can file a claim for MDR relief HERE