Finance (No. 3) Bill (Sixth sitting)

Debate between Bambos Charalambous and Mel Stride

Tuesday 4th December 2018 Public Bill Committees

[Mel Stride]

Clause 45 makes changes to improve the SDLT filing and payment process. In answer to the hon. Lady’s question about whether we will provide facilities on the site to pay simultaneously, we do not have plans to do so. That is because the online service cannot be combined with Bacs and CHAPS services at present.

The hon. Lady made a more general point about the mistakes that are made in filing. As she knows, we consulted on the information being sought as part of the process, and we will be applying various simplifications as a consequence, most notably around complex commercial lease arrangements. The information that we have hitherto sought in that respect will now no longer be sought. That simplification, and others, should be beneficial in cutting down the mistakes that the hon. Lady referred to.

Currently, the purchaser of land, or the purchaser’s agent, must make a stamp duty land tax return and pay tax due within 30 days of the effective date of the transaction—usually the completion date. The changes made by clause 45 will reduce the time allowed to make an SDLT return and pay the tax due from 30 days after the effective date of transaction to 14 days. That is in line with other initiatives in recent years that bring tax reporting and payment closer to the date of the transaction. The hon. Lady referred, I think, to clause 14 on capital gains tax, where a similar approach has been taken. This is in line with these other initiatives.

The measure will not change liabilities for the purchaser, but will lead to tax being paid earlier. The change applies to purchases of land situated in England and Northern Ireland where the effective date of the transaction is on or after 1 March 2019. This change will directly affect approximately 20,000 businesses, mainly agents, such as licensed conveyancers and solicitors. Each year, this will directly affect fewer than 500 individuals who file their own SDLT returns without using an agent. However, the impact on administrative burdens for businesses is expected to be negligible.

The Government announced the change at autumn statement 2015 and consulted on it, as the hon. Lady described, in 2016. The Government confirmed at autumn Budget 2017 that it would come into effect on 1 March. To help purchasers and agents to comply with the new time limit, HMRC has worked with key representative bodies to agree simplifications to the SDLT return, for example, by reducing the amount of information required. These improvements will be in place when the new time limit begins. The measure will result in a yield of £60 million in 2018-19—the year of implementation—and a small ongoing yield in future years.

Amendment 95 would require a report on any consultation undertaken on the provisions in this section.

[Bambos Charalambous (Enfield, Southgate) (Lab)]

What steps has HMRC put in place to make sure that the 20,000 businesses that are going to be affected are properly informed of the change, and know that it is coming?

[Mel Stride]

HMRC will, as a matter of course, issue guidance on all major tax changes, and that will be available online. As part of the consultation, as I have outlined, a number of these organisations were consulted in detail, not just about the measures but to make sure that those businesses are ready and appropriately informed.

The amendment is not necessary. I can give the Committee the information it requires now, because it is already in the public domain. The Government published a document on 20 March 2017 in response to the consultation that we published in the autumn of 2016, and we published draft legislation in July 2018 for technical consultation. HMRC also held meetings with stakeholders, which included representative bodies from the property and conveyancing industries. Their views on the information required in the return are reflected in the changes being made to make compliance with the new time limit easier.

New clause 13 would require a review of the equality impact of clause 45. The new clause is not necessary either, because the Government set out in the tax information and impact note published on this change in July 2018. It is not anticipated that there will be any impact on groups with protected characteristics. Clause 45 does not change anyone’s SDLT liability; it just brings a requirement to file a return and pay the tax closer to the date of the transaction. For that reason, direct impacts on different types of households will be negligible, and the type of analysis required by the amendment would not be meaningful.

Regarding other regions of the UK, Land and Property Services in Northern Ireland—an agency of the Department of Finance of the Northern Ireland Executive—was consulted and is content with the measures. The changes will improve the SDLT filing and payment process, and I commend the clause to the Committee.

Oral Answers to Questions

Debate between Bambos Charalambous and Mel Stride

Tuesday 22nd May 2018 Commons Chamber

[Mel Stride]

I am clearly not going to speculate about future tax changes from the Dispatch Box this morning, but I point out that we have frozen fuel duty for eight successive years at a cost to the Exchequer of over £40 billion.

[Bambos Charalambous (Enfield, Southgate) (Lab)]

A Home Affairs Committee report published in summer 2016 found that the suspicious activity reporting system intended for use by the banks to crack down on money laundering was not fit for purpose. The Committee demanded immediate reform, but the Government stated that they would implement the reforms only by 2018. In the light of the Foreign Affairs Committee report on Russia, criminal financing and the UK, will the Minister immediately bring forward plans to reform and improve the system, as was recommended two whole years ago?

Paradise Papers

Debate between Bambos Charalambous and Mel Stride

Monday 6th November 2017 Commons Chamber

[Bambos Charalambous (Enfield, Southgate) (Lab)]

Will the Minister confirm what justification there was for voting against Labour’s amendments to the Finance Bill last week that sought to curb the number of individuals claiming non-dom status and improve transparency with regards to offshore trusts?

[Mel Stride]

If the hon. Gentleman is referring to the trust arrangements for those who become deemed domiciled as a consequence of this Government deciding to put an end to permanent non-dom status—something that his party never did in its 13 years in office—he will know that all is not quite as the Labour party presents it. Any funds coming out of such trusts will, when they are remitted, fall due to tax by the deemed domiciled individual exactly as they would for any other UK citizen.