Watchdog rules against adviser offering 60% saving on stamp duty
HMRC and another tax lawyer complained about claims made by CDP Tax and Wealth Ltd t/a Fiducia Wealth & Tax.
The adviser’s website featured the headline ‘Calculate Stamp Duty Land Tax We Will Save You A Minimum Of 60%’.
Text added: “We do not promote nor advocate stamp duty avoidance schemes. Instead we seek to efficiently plan our clients’ property tax affairs by only utilising government approved statutory tax rules that are contained within the tax legislation, so that our clients only pay the tax intended by Parliament”.
Further text on site read: “At Fiducia, we tailor our stamp duty land tax (SDLT) strategies to each individual property purchase and client, making sure that every regulation is fully catered for along the way”.
Fiducia also claimed its plans “don’t require you to notify HMRC and reduce delays in the conveyancing process overall”.
It also stated planning is carried out by Solicitors Regulation Authority (SRA) firms adding one of the cornerstones of SRA regulation “is that the firms must act in your best interests at all times”.
Complainants said the arrangement promoted did in fact meet the definitions of tax avoidance and made the payment of stamp duty appear optional.
HMRC also said the company misleadingly implied their arrangements did no more than use statutory reliefs from SDLT for the purpose for which they were designed.
The tax office further raised issue with the claim that Fiducia’s plans don’t require clients to notify HMRC, and the firm misleadingly implied endorsement from the SRA, whereas HMRC said the SRA had in fact issued a warning relating to SDLT schemes.
Finally, HMRC said the text misled by omission, because it failed to make clear there might be actions or costs if HMRC challenged the arrangement, including those costs which arose as a result of the General Anti Abuse Rule (GAAR).
The ASA investigated and upheld all five of the issues. CDP Tax and Wealth Ltd t/a Fiducia said they did not consider the ad was implying that the payment of SDLT was optional but suggested a saving might be available.
The firm also did not believe it implied endorsement by the SRA and did not consider they had misled by omission.
In a written ruling, the ASA said it “did not consider that we had seen sufficient evidence to show that Fiducia’s arrangement was not a scheme of avoidance and would not be subject to a challenge from HMRC”.
The ASA ruled the ads must not appear again in the form complained of, adding: “We told Fiducia to ensure they held sufficient evidence for their claims and to disclose any relevant information in their advertising, such as the implications or risks of entering into a financial arrangement, including a challenge to a user’s tax arrangements by HMRC and the charges which might apply.
“We also told Fiducia not to imply they had been endorsed by the SRA.”