STSM142140 | Stamp duty and SDRT administration: SDRT administration: SDRT determinations

SDRT Determinations

A notice of determination is the assessment mechanism by which HMRC may recover underpaid tax (or over-repaid tax).

Regulation 6 SI 1986/1711 gives HMRC the power to give notice in writing to a person or persons stating that it has determined the matters specified in the notice. A notice may be given to anyone that appears to HMRC to be the accountable person, operator, liable person or claimant in relation to a relevant transaction (or a claim in connection with a relevant transaction).

HMRC may not recover underpaid tax or over-repaid tax unless the amount has been agreed in writing or determined by a notice of determination (regulations 12 and 18). There is a 4 year time limit for making such a determination which runs from the later of the date payment was made and accepted and the relevant accountable date (regulations 13 and 18). This is extended to 6 years where the underpayment or over-repayment was brought about carelessly and to 20 years where it was brought about deliberately.

Penalties for incorrect SDRT notifications

HMRC may also issue penalties for incorrect notifications (Schedule 24 FA2007). The amount of the penalty will depend on the behaviour which led to the error occurring.

Information on penalties for incorrect SDRT notifications is available:

• On gov.uk; and

• In the compliance handbook

Appeals against SDRT determinations

An appeal against a notice of determination may be made within 30 days of the service of the notice (regulation 8). Appeals are made to the First-tier tax tribunal although an appeal can be notified to the High Court either by agreement or (if the High Court agrees) by application to the High Court by the appellant.

If an appeal has been lodged against a notice, then legal proceedings to recover the tax can be taken only for such amounts as have been agreed (or amounts determined in a further notice to be a part not in dispute) - regulation 12. This restriction on recovery proceedings only applies for an appeal under regulation 8 and not for any further appeal.