Conveyancing Legal Software and the new Land Transaction Tax return challenge
From 1 April 2018 Stamp Duty Land Tax (SDLT) was replaced by a new property tax called Land Transaction Tax (LTT) managed by the Welsh Revenue Authority.
The Welsh Revenue Authority’s lack of consideration of the Legal Software industry as a key stakeholder in the conveyancing process needn’t be a backward step for the UK e-conveyancing program.
It has been said that the introduction of this new Land Transaction Tax has resulted in a significant backwards step for e-conveyancing as the new collector of this property tax – the Welsh Revenue Authority has ignored property professionals who have invested in specialised Legal IT to handle the conveyancing process.
Summary of Welsh Revenue Authority’s current position on Legal Software integration with LTT
Managing Director of SDLT.co.uk, Archie Courage engaged with the Welsh Assembly in the early stages of consultation.
At a recent meeting held with WRA and several Legal Software Suppliers, Archie concluded:
“The WRA didn’t really have a policy with regards B-2-B technical connectivity, due to a belief there is no requirement to provide a connection. To do so would be a financial/ time consuming/ support burden upon WRA and a poor use of public funds, there being higher priority areas to spend resource.”
WRA has not considered the Agents ‘efficiency, cost and time burden’ in managing a process that does not integrate with legal software forcing Agents to have to manually rekey data that already stored in their CMS databases.
Since the last meeting with Legal Software Suppliers, the WRA are now considering a business case for software integration.
Meanwhile could the use of the WRA portal increase the Agents liability?
The WRA LTT system produces a summary of the questions and answers in either draft or final format. WRA insist that the Agent provides a copy of their Privacy Notice to the purchaser and the purchaser acknowledges they have read the privacy notice along with making a declaration that the proposed draft is True, Accurate and Complete. But this cannot be achieved using the WRA LTT portal.
The WRA LTT portal does not produce a complete and detailed copy of the full LTT return form, (showing all questions and relevant answers whether answered or left blank). So how can the Agent’s client declare, that their LTT return is ‘True, Accurate and Complete’?
Using the WRA LTT portal to show a client only what is answered changes the legal onus from the client onto the Agent,. There is no way for the Agent to provide their client access to a comprehensive set of answered and unanswered questions from within the WRA LTT portal so that the client can sign the return and accept the liability of it being ‘True, Accurate and Complete’. Agents should ask themselves where does the risk lie?
So what should Agents/Conveyancers do? – Use Legal Software of course!
Agents/Conveyancers should look to their legal software suppliers such as their Case management supplier and tax software providers who provide an LTT return system that allows the Agent to produce a full paper copy of the WRA approved LTT paper form.
After completion the Agent can sign on their behalf and send the return to WRA, accurately knowing that as Agent they have fulfilled their client’s instruction risk free and in a professional manner.
WRA and HMRC do not integrate with HM Land Registry and yet the data is the same. The SDLT.co.uk solution has proved that a legal software process works with a paper LTT form and can still facilitate the online eSubmission of the HM Land Registry application to change the register (eAP1).
- Land Transaction Tax return’s drafted via legal software,
- LTT form integrated with CMS and SDLT.co.uk can be completed in just 2 minutes!
- Full LTT form sent to client and signed,
- Full LTT forwarded by agent to WRA for processing,
- LTT certificate returned (currently 2 day turn around by WRA)
- Certificate uploaded in readiness to eSubmit with eAP1
Conveyancer who have invested in Case Management/Search Company Application integration with SDLT.co.uk will benefit further by using this LTT system as SDLT.co.uk has ensured that all relevant mutual LTT and SDLT questions will auto populate either return as appropriate with no requirement to change the existing CMS/Search integration.
Kindly shared by SDLT.co.uk