the 15 largest London-based housing associations are to discuss the implications of a stamp duty ruling that is set to cost the sector across England and Wales millions of pounds.
The G15 group's discussion follows one of its members, Genesis Housing Group, threatening a legal fight over the issue (HT 21 November, page 14).

A source said: "It looks as though Genesis is now not taking this forward on its own. It will be something that the G15 discusses at its next meeting."

Genesis is set to lose as much as £2m in back-dated stamp duty payments after a judicial ruling earlier this year that judges in England and Wales should no longer accept repossession cases brought by associations who had neglected to pay stamp duty on the tenancy.

The ruling picked up on a long-forgotten point in the 1891 Stamp Act (HT 20 June, page 10) which means duty should have been paid on almost all agreements made before March 2000.

It also meant the Inland Revenue was set to collect large sums in back-dated stamp duty.

Genesis may not take this forward on its own – the G15 will discuss it at its next meeting

Genesis is particularly badly affected because it has a high turnover of tenancies in 2600 units in north-west London owned by its temporary housing arm West Hampstead.

In a letter to Housing Today this week, National Housing Federation policy officer Bob Wilson and Trowers & Hamlins solicitor David Golten outline the basis of any case that could be brought against the Inland Revenue.

They wrote: "The legal challenge would be based on the artificial distinction the Inland Revenue makes between a tenancy 'expressed to be for a week and thereafter continuing weekly' and one expressed simply to be 'weekly'."

The pair stress that the latter point is the format most commonly used by housing associations and is, according to the Inland Revenue, stampable. The former, it says, is not.

Source

Housing Today