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Coronavirus: changes to stamp duty payments

Gateley Legal

As a result of the recent government advice regarding Covid-19, HMRC have announced new measures to address the stamping of documents while the physical stamp presses are closed down.

Payment

Stamp duty is now required to be paid electronically using Bacs, Faster Payment or CHAPS.

The bank details of the Stamp Office, correct as at 25 March 2020 are:

Sort code: 08 32 10
Account number: 12001098
Account name: HMRC Birmingham Stamp Office

Late payment

The current time limit for paying stamp duty is 30 days after the execution of the document to be stamped e.g. the date of a stock transfer form. This remains the time limit under the electronic arrangements. For faster payments or CHAPS, you should allow one day for the payment to reach HRMC, whereas for BACS payments, HMRC recommend allowing 3 working days. If the expiry of the 30 day deadline falls on a weekend or bank holiday, the payment must have reached HMRC on the last working day before the deadline to avoid penalties and interest accruing.

For any stamp duty payments less than 12 months late, the penalty is 10% of the stamp duty with a cap of £300. For documents 12-24 months late the penalty is 20% of the duty and for documents more than 24 months late the penalty is 30% of the duty. HMRC will not require a penalty to be paid if it is less than £20 and any penalty can be rounded down to the next £5. In the case of delays longer than 12 months, HMRC can impose higher penalties up to the total stamp duty if the failure to submit documents for stamping is found to be deliberate.

If there is a reasonable excuse for the delay, HMRC may, in their discretion, cancel the penalty. However, there is currently no indication whether delay as a result of Covid-19 impacts would be an acceptable excuse to mitigate the penalty. 

Interest may also be charged on late payments. The official rate of interest of HM Treasury is used, which is 3.25% per annum as of 25 March 2020. HMRC will not require interest to be paid if it is below £25.

More information?

The guidance summarised above is the initial guidance provided by HMRC and may be updated in the coming days. For more information on paying stamp duty please see the government advice at: https://www.gov.uk/guidance/pay-stamp-duty#how-to-pay

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