An SDLT enquiry is a formal review by HMRC of a Stamp Duty Land Tax return. HMRC has 9 months from the filing date to open an enquiry (or 9 months from an amendment). An enquiry does not automatically mean something is wrong with the return. It means HMRC wants to examine the position more closely. However, how you respond to the enquiry determines how it proceeds, and an early, well-prepared response makes a significant difference to the timeline and outcome.
HMRC focuses its SDLT enquiry resources on areas where incorrect treatment is most common and the revenue at stake is highest. Common triggers include: mixed-use SDLT claims, particularly where the non-residential element is marginal; relief claims on company purchases, especially the property rental business relief against the 15% rate; linked transactions where the connection between purchases has not been properly reflected in the SDLT computation; and unusual transaction structures such as sub-sale relief, assignment of contracts, or partitioning arrangements.
HMRC also uses data analysis to identify patterns: returns where the effective SDLT rate is significantly lower than expected for the property type and purchase price, or where the same adviser is filing a high volume of claims in a specific relief category.
We review the HMRC enquiry letter and the original SDLT return to understand exactly what HMRC is questioning and why. We assess the strength of the position that was filed: whether the treatment was correct, whether it was supportable but arguable, or whether there may be an error that needs addressing.
We prepare a structured response to HMRC that addresses the specific points raised, provides the requested information, and presents the supporting analysis in a clear and professional format. Where the original position is correct, we defend it with evidence. Where there is an error, we quantify the exposure and advise on the most appropriate way to resolve it, including the penalty position.
We manage all correspondence with HMRC throughout the enquiry. You do not need to communicate with HMRC directly. We push for resolution within a reasonable timeframe and keep you informed at every stage.
Do not ignore the letter. HMRC will escalate if you do not respond, and they have the power to issue a determination based on their own assessment of the tax due.
Do not respond in haste. The information you provide becomes part of the enquiry and cannot be withdrawn. Take the time to get professional advice before replying.
Do not provide more information than specifically requested without first understanding the implications. This is not about withholding — it is about responding accurately and proportionately to what HMRC has asked.
Send us the letter along with a copy of the original SDLT return. We will review both, advise on the position, and prepare the response.
Send us the HMRC enquiry letter and your original SDLT return (or instruct your solicitor to provide it to us if they filed it).
We review the return and assess the basis of HMRC's enquiry. We advise you on the strength of the position and the likely range of outcomes.
We prepare and submit a formal response to HMRC with supporting documentation and analysis.
We manage all subsequent correspondence, including any follow-up requests from HMRC. If a meeting with HMRC is required, we attend on your behalf.
Schedule a free 30-minute consultation to discuss your personal tax compliance.
