Adjudication Agreement Stamp Duty: Everything You Need to Know
Adjudication agreements are becoming increasingly popular in the world of construction. They are a way of resolving disputes without the need for lengthy and costly court proceedings. However, there are some costs associated with adjudication agreements, including stamp duty.
In this article, we will explore what adjudication agreement stamp duty is and how it works.
What is Adjudication Agreement Stamp Duty?
Adjudication agreement stamp duty is a tax that is levied on certain types of documents. In particular, it is payable on agreements for the referral of disputes to adjudication. This includes agreements that are made before or after a dispute arises.
The amount of stamp duty payable on an adjudication agreement depends on the sum in dispute. If the sum is less than £5,000, no stamp duty is payable. If the sum is between £5,000 and £15,000, the stamp duty payable is £50. For sums over £15,000, the stamp duty payable is £100.
Stamp Duty Exemptions
There are some exemptions to the stamp duty payable on adjudication agreements. These include:
– Adjudication agreements made in connection with contracts which are wholly or substantially performed outside the UK.
– Adjudication agreements made in connection with contracts which do not relate to the carrying out of construction operations as defined in the 1996 Construction Act.
– Adjudication agreements made in connection with contracts which are not in writing.
When is Adjudication Agreement Stamp Duty Payable?
Stamp duty on adjudication agreements is payable within 30 days of the document being executed. The person responsible for paying the stamp duty is the party who initiates the adjudication.
Failure to pay stamp duty on an adjudication agreement can result in penalties and interest charges. It is therefore important to ensure that the stamp duty is paid on time.
Conclusion
Adjudication agreements are a useful tool for resolving disputes in the construction industry. However, it is important to be aware of the stamp duty payable on these agreements. The amount of stamp duty payable depends on the sum in dispute and there are some exemptions to the tax.
If you are considering entering into an adjudication agreement, it is important to seek legal advice to ensure that you understand your obligations. A professional can ensure that your article is clear and concise, helping you to communicate your message effectively.