Stamp duty guidance for conveyancers to manage client expectations
By Monidipa Fouzder >>
A policy of no completions beyond 20 June is one of several suggestions in guidance issued by the Law Society to help conveyancers manage the expectations of clients rushing to take advantage of the stamp duty land tax ‘holiday’ before it ends.
The current stamp duty holiday for properties in England ends on 30 June, followed by a tapered rate until the end of September. In Wales the land transaction tax concession will come to a hard end on 30 June.
In new guidance, the Society said any assumptions that clients and other parties in the chain have on timing should be corrected. Clients should be informed of the ‘admittedly not-so-beneficial’ arrangements that will come into force from 1 July so they know what to expect if the June deadline is not met.
Many lenders may not be able to remit huge volumes of mortgage monies close to the deadline. Clients should be told they may be liable for stamp duty if they exchange now but do not complete on time.
The guidance says: ‘To mitigate against these risks, you may need to develop policies for your firm so that, for example, you will not agree completion dates of later than 20 June and will amend the notice to complete timings so that the period is reduced to no longer than five working days… Rights to terminate in certain circumstances need to be discussed and incorporated in the contract.’
Solicitors should check if the lender has imposed a condition that the transaction can only proceed if the stamp duty concession is available.
Firms should notify their insurers if work volumes have increased significantly.
Society president I. Stephanie Boyce said many factors limiting the speed of a move are usually outside the conveyancer’s control. ‘It is key at this stage for conveyancing solicitors to take steps to manage their clients’ expectations about completing in time to take advantage of the stamp duty holiday,’ she said.
The surge in demand for conveyancing services has highlighted fundamental problems within the sector as solicitors work late into the night to meet the 30 June deadline.
(Courtesy: The Law Society Gazette)