Can I pay lower Stamp Duty Land Tax in house exchange

I went to view a house today that the vendor was trying to sell for
£280K. It just so happens that he was looking for a house similar to
the house we are selling for £225K. It naturally occured to us to
exchange houses and thereby avoid agents fees and avoid the problems of
a long chain. The person we are buying off of said that he thought that
there is also less SDLT to pay if you exchange houses but I have looked
on the internet tonight and it seems that the Chancellor has closed
many loopholes in this area in Dec 2003. However I have not been able
to accertain with any certainty if he has closed the following
loophole.

I am presumably at liberty to offer whatever I want to offer for his
property so I propose to offer only £249K. Since the 3% stamp duty
band starts at £250K I will thus save my self several thousand pounds
on stamp duty if he accepts my offer. He may take the view that as the
market is currently very slow, especially in houses over £250K (for
obvious reasons), he would be prepared to accept my offer even though
it is below market value for his house (after all he is also getting a
quick sale and no chain into the bargain). Because he is getting £31k
less for his house than anticipated he can only afford to offer me
£194 for my house. I am keen to accept the offer because I would also
benefit from there being no chain and getting the quick sale I desire.
The consequence of this deal is that neither of us loses out because
the difference between our houses is still the same. However the taxman
loses out because I pay SDLT at only 1% instead of 3% and we both sell
our houses for £31K less so the excheque loses the SDLT on this also.

Will the Inland Revenue accept my vendors right to accept my low offer
on his house or will they ignore the purchase and sale prices and
impose SDLT at market value on the exchange?

Hope I've made myself clear enough. Thanks for any advise you can give
me.

.

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