January 2023

HMRC changes in processing option to tax form

Posted on 27 January 202330 March 2025 by Sarah O'Sullivan

From 1 February 2023, HM Revenue and Customs (HMRC) will no longer confirm the existence of an option to tax when requested to do so by property owners or solicitors, except in specific circumstances. These circumstances are limited to where the option to tax was likely to have been notified more than 6 years ago or if the enquiry is from an appointed receiver or insolvency practitioner administering the property in question.

In addition, HMRC will no longer issue option to tax acknowledgement letters once an option to tax has been notified. Property owners will therefore need to keep a record of the notification of their option to tax and we strongly recommend that all notifications are sent to HMRC via email to: optiontotaxnationalunit@hmrc.gov.uk. The email should include in the subject line the full property address and the effective date of the option to tax. This is because an automated response to the email will be received, which can be used as evidence that the option to tax has been notified to HMRC. Property owners and businesses are currently required to keep their VAT records, including options to tax, for six years, however, we advise that these records will now need to be kept throughout the ownership of the property in question to ensure that the correct tax treatment is applied on a sale or lease.

You can read more about the changes on the Goverment website here.

What happens on completion day?

Posted on 26 January 202326 March 2025 by Sarah O'Sullivan

The day of completion is the final step in the house buying and selling process. It is the pre-arranged date when the financial and legal formalities are concluded, and the ownership of the property is transferred from the seller to the buyer.

On the day of completion, the following steps typically take place:

The buyers’ solicitor will transfer the funds to the sellers’ solicitor.
Once the funds have been received, the seller’s solicitor will contact the buyer’s solicitor to confirm that the funds have been received and will confirm to the estate agents that the keys can be handed to the buyers.
The seller’s solicitor will then send the deeds of the property to the buyer’s solicitor.
The buyer’s solicitor will check the deeds to ensure they are in order and that the property has been legally transferred to the buyer. They will then apply for the title to be amended at the land registry.

The buyer is responsible for arranging the connection of utilities, registering with the local council and other services required at the new property. All of this should be completed from the date of completion. The buyer will normally be responsible for the building’s insurance from the date of exchange rather than completion. Your solicitor will make you aware of this at the appropriate time in the process.

The completion date is the date the buyer takes possession of the property and will have been agreed on by both parties in the sale contract. However, on occasion, the completion process may be subject to delays or complications, and it’s always advisable to work with a reputable solicitor and estate agent to ensure a smooth and efficient process.

Answers to common questions about the day of completion day:

What do conveyancing solicitors check on completion day?

Your conveyancing solicitor will handle the legality of transferring the funds, confirming the transaction has been completed, dealing with all the paperwork and deeds, and (if you’re the seller) redeeming or discharging any mortgage secured against the property.

Prior to completion, the buyer’s conveyancing solicitor will check all mortgage conditions have been met and request the money from the lender.
The seller’s solicitors will request a redemption statement (calculated to the day of completion) if there’s a mortgage on the seller’s property.
For the buyer to become the new registered owner of the property, the transfer deed must be signed by the seller (and also sometimes the buyer). This is usually prepared in advance prior to the completion day.
Conveyancing solicitors on each side create completion statements of all payments made and received and set out any invoices to be paid on completion.
On completion day both solicitors make final checks, and then the buyer’s solicitor will transfer the purchase money via the CHAPS banking system to the seller. For more information on CHAPS, visit the Bank of England website.
Once the signed transfer deed and any other deeds are received, the buyer’s solicitor will complete and submit a transfer form to the Land Registry. This enables the transfer of ownership from the seller to the buyer.
Once the seller’s solicitor has received the funds, they’ll confirm completion with the buyer and release the keys from the estate agent. They also ensure specific charges are paid, including the seller’s estate agent fees.
The buyer will be notified of the completion they can then move into the property.

What can go wrong on completion day?

On completion day, there are several potential issues that may arise, which could delay or disrupt the process of transferring ownership of a property. One potential issue is a delay in the transfer of funds from the lender to the solicitor and between solicitors in the chain of the sale. These delays may occur due to fraud checks, technical difficulties or a lack of sufficient funds. It’s essential to ensure that all outstanding bills and fees, including stamp duty land tax, if applicable, are settled before completion day to avoid any issues.

There may also be delays with the seller vacating the property on time. It’s important to confirm with your removal company the time of their arrival and be prepared for how long it will take to move your belongings. To minimize disruptions, it’s recommended to do as much packing as possible before completion day.

What time do you normally get the keys on completion day?

The time that keys are handed over on completion day can vary depending on the specific circumstances of the sale. Typically, keys are handed over to the buyer once the funds have been transferred and the legal paperwork has been completed. The exact time of key handover will be agreed upon by the buyer and the seller, and it’s usually coordinated through their solicitors or estate agents.

Usually, the keys are handed over in the afternoon, between 12:00 pm and 4:00 pm, but it can vary. The buyer and the seller can agree on a specific time and date to hand over the keys, based on their availability and the time they need to move out of and into the property.

If the completion process is subject to any delays or complications the keys may be handed over later than expected. Therefore, it’s always advisable to have a plan B. Open communication with the seller and your solicitor can help avoid these delays.

Should I call my solicitor on completion day?

Your solicitor will call you when completion has happened. However, it’s a good idea to contact your solicitor on completion day to confirm that the process is proceeding as planned and that all necessary paperwork has been completed. They can also advise you on any final steps that may need to be taken and answer any questions you may have about the property transfer.

In summary, on completion day, you need to make sure the funds are transferred, legal paperwork is completed, arrange for utilities to be connected, register with the local council and other service providers, collect keys, and move into your new property.

Pension planning during times of uncertainty

Posted on 9 January 202328 March 2025 by Sophie Soraf

There have been various difficulties in recent years, affecting the UK economy that have had an impact on pension savers. These include Brexit, the COVID-19 pandemic, the conflict between Russia and Ukraine as well as political instability in Westminster. These events have caused turbulence in the markets, leading to a decline in share prices and other investments. If you have a workplace pension or a personal pension you may have noticed that its value has decreased as a result. While this can be concerning, it is important to remember that it is a temporary setback and there are ways to weather the storm.

What should I do about my pension if I see the value dropping?

Even though these are unprecedented times, as an investor, it’s useful to put any short-term volatility into historical context, to get the bigger picture, rather than focusing too intently on short-term events and market fluctuations.

Market analysts and investors aren’t infallible, they become nervous in uncertain times. This is because the loss of trade and tourism can pose a threat to companies of any size. So, it’s little wonder that stock markets have fallen and you are likely to have seen a drop in the value of your pension pot over the course of the last few years.

However, it’s worth remembering that the recent falls have come after some very strong rises in recent years. Also, your pension pot is unlikely to be invested solely in equities, so a 5% fall in the market does not necessarily equate to a 5% fall in the total value of your pension fund. In fact, the typical pension pot will contain a broad range of assets, which have been identified to fit in line with your attitude to risk, personal objectives and time frames.

A typical pension fund contains around 60%-65% in shares, with the rest in government and corporate bonds, property and cash. In contrast to equities, government bonds have actually increased in value during the crisis.

Will my pension pot ever recover?

Investment requires a disciplined approach and a degree of holding your nerve if markets fall. Experienced long-term investors know that the worst investment strategy you can adopt is to jump in and out of the stock market, to panic when prices fall and to sell investments at the bottom of the market.

The importance of keeping to your long-term plan is evident by studying the performance of the FTSE 100 over the last 20 years or so. Back in the autumn of 1998, the FTSE 100 fell by 1,000 points, amidst an environment of high-interest rates and other threats to UK economic growth. However, it had almost fully recovered by the end of 1998 and the index soared close to 7,000 in 1999. A global slowdown brought it back down to around 3,600 in the spring of 2003, before taking another five years to climb back to around 6,500. Then, the global financial crisis happened and the index was back at 3,500 in March 2009. After a long haul back, the index was at over 7,000 in January 2020 before the pandemic affected global markets.

Over the last 20 years, despite a variety of market shocks and rebounds, the index still has a long-term growth trend. It’s important to remember that some market volatility is inevitable. Markets will always move up and down, but it’s important to stick to your long-term plan.

Is now a good time to top up my pension?

Providing you are investing for the long term, you may wish to consider investing more into your pension pot. Even a small increase in contributions could make a difference to your final pension pot if it benefits from an upturn in the market and makes up for recent losses.

Remember that whatever type of pension plan you hold, you get tax relief at the highest rate of Income Tax you pay, on all contributions you make, subject to annual and lifetime allowances. This effectively means that some of your earnings which would have gone to the Government as tax are diverted to boost your pension pot instead.

You receive ‘relief at source’ if you pay money into your personal pension yourself or if your workplace pension contributions are taken directly from your pay packet. In both circumstances, you automatically receive 20% tax back from the Government in the form of an additional deposit into your pension pot. So, for instance, if you’re a basic-rate taxpayer investing £800 of your take-home pay into your pension, the tax relief would amount to £200. Effectively the taxman tops up your £800 contribution to £1,000.

How do I make sure my pension is protected?

As well as taking a long-term view of your pension, regular reviews are essential to ensure you remain on track with your well-defined plan, in accordance with your objectives and attitude to risk. If there have been any changes in your objectives or circumstances, it is particularly important to review and make any adjustments where needed.

When investing, you have to decide how much risk is right for you. Successfully achieving your long-term goals requires a balance between risk and reward, so you can construct a diversified portfolio with the potential to improve returns that matches your elected level of risk. While a diversified portfolio should incorporate strategies to help reduce risk, it cannot be eliminated altogether. The process of building such a portfolio is very difficult to achieve without professional advice.

Can I get advice about my pension?

In these uncertain times, more than ever, it’s important to take professional independent financial advice, from someone who will help you to make the right financial decisions and identify and meet your goals and aspirations. Research shows that those who take advice are likely to accumulate more wealth, supported by increased savings and investments in equities. Also, those in retirement are likely to have more income, particularly at older ages.

Tees Wealth Management listed in Citywire New Model Adviser Top 100

Posted on 9 January 202330 March 2025 by Sarah O'Sullivan

We are proud to announce that our wealth team at Tees has been recognised by Citywire’s New Model Adviser as a Top 100 financial planning firm in 2022.

New Model Adviser is a prominent industry publication and its Top 100 honours the best of the financial planning community, recognising advice firms across the UK who are leading the way in the industry and providing exceptional Client service. As one of the top 100 financial planning firms in the UK, we have been widely praised by our clients, and through our team of experienced professional advisers, we help our clients to realise their financial goals, objectives and dreams, through our bespoke financial planning service.

James Appleby, commented “We are delighted to be named in the New Model Adviser Top 100. This acknowledgment recognises Tees’ commitment to our clients and the communities in which we operate, as well as the high level of professionalism, dedication and client focus demonstrated by the advice team.“