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Are you entitled to a stamp duty rebate?

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If you’ve bought a home in a ‘disadvantaged’ area over the last decade then there’s a chance you could be entitled to a stamp duty rebate – but you have to act fast. HMRC’s Disadvantaged Areas Relief (DAR) reduced the amount of stamp duty payable on properties up to £150,000 in one of 2,000 areas designated by the Government as disadvantaged. It only applies to purchases made between December 1, 2003 and April 5, 2013 – when the relief was abolished.

However the deadline for rebate applications is May 5, so homeowners must check their eligibility – which can be done via a HMRC postcode checker – straight away, as any claims made after May 5th will not be accepted.

How much can I claim?

Those who are eligible would have paid one per cent tax on the purchase of their property – therefore entitling them to a maximum £1,500 rebate. According to the revenue and customs department, around 30,000 people a year bought a property in a ‘disadvantaged’ area during the ten-year time frame, meaning up to 300,000 could potentially claim although it is not clear how many incorrectly paid the stamp duty. In many cases the tax break may not have been applied because of a general lack of awareness.

Which areas does DAR apply to?

The stamp duty relief is applicable in almost 2,000 areas of the UK which are based on local government wards and electoral divisions in England, Wales and Northern Ireland, and on postcodes in Scotland. To qualify for relief a property must have been in a qualifying area at a ‘relevant date’ determined by the Government. This date varies depending on the country of the UK.

Checking a property qualifies

If you know the postcode of the property you can check its eligibility using a postcode search tool on the HMRC website, which also lists all the areas classified as disadvantaged.

How to claim

You can claim the relief by writing to HMRC at Birmingham Stamp Office, 9th floor, City Centre House, 30 Union Street, Birmingham, West Midlands, B2 4AR. You will need to include a copy of your original Stamp Duty Land Tax return, or the ‘unique transaction reference number’ (UTRN) from the return. Your conveyancer should have submitted the return within 30 days of the property completion date. You will also be asked to outline how much you paid in stamp duty and why you think you are eligible for a rebate.

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