Stamp duty on house over 125 sq. metre

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nigel27

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36
Hi,

I am a second time buyer of a new home that is 129sq meters. My solicitor tells me that I am lilable for stamp duty of 5% on the site cost of €283,000 which is apx €14000 (Buliding costs are €134000).The builder says that the stamp duty should be apx €9000 and that the solicitor is not taking off the vat on the site. The auctioneer that is selling my home says that I shouldn't have to pay any stamp duty on the houseif I can get a much smaller site valuation on the new house.I don't know who to believe.My budget is at it's limit.Which is true???
 
Re: stamp on house ove 125sq meter

The rule is that if the house is over 125m2 you pay stamp duty on the higher of the site price or a quarter of the total price. As your total price is €417k and the site price is €283k then it looks like your solicitor is right. You might want to check with him/her where the site cost is coming from.
 
Re: stamp on house ove 125sq meter

the builder is 100% correct, solicitor is wrong. the auctioneer is suggesting a fiddle.
 
Re: stamp on house ove 125sq meter

heres some proof
New houses or apartments which are purchased by an owner occupier (including a first time buyer) where the total floor area exceeds 125 square metres are charged with duty, at the appropriate residential property rate as per the table above, on the site value (excluding VAT) or one quarter of the total value of the house including the site (excluding VAT), whichever is the greater, subject to clawback. The size of the floor area must be certified by a qualified architect, engineer or surveyor


taken from
[broken link removed]
 
Nigel,
I was in the exact same position about 4-5 months ago. My house was 185square mtrs and purchase price of 495,000. My solicitor contacted revenue for the definitive answer and it turns out stamp duty was less than 1000. What a relief at the time... I suggest you would do the same, get your solicitor to contact the revenue directly and find out for sure.
 
Your builder is right althought his figure is out a bit, you solicitor is definately wrong. The net base cost is €249339 at 4% stamp duty €9973.57
 
my original post was a bit premature, i hadnt crunched the numbers
eggnog is partially right but unfortunately its 9% not 4%
the stamp would be either
based on the 1/4 of the completed value house +site together (ex vat @13.5%) 92070 @exempt = 0

or the value of the site ex vat 249339 @ 9% = 22440
(its 9 % for sites over 150000 - diff rates to completed houses)

site@9% is greater so thats what you pay
the site value is whats screwing it up.
unless its dublin/wicklow/kildare, the site value does seem a bit over the top.
the builder might be doing the house at cost and taking his profit from the site to avail of the 20% tax rate for land sales
 
xt40, the stamp duty is not based on site price as being a site purchase, it is based on Chargeable Considertion for purchase of houses over 125sqm.
 
reading further through the revenue stamp guide, it appears to contradict itself

here
"on the site value (excluding VAT) or one quarter of the total value of the house including the site (excluding VAT), whichever is the greater,"

versus

Sites
  • Where an individual purchases a site in connection with, or as part of, an arrangement to build a house or apartment on that site then stamp duty will be charged, subject to the reliefs referred to above, based on the aggregate amount of the site cost and the building cost at the appropriate residential property rate.

  • Where an individual purchases a site with no connected agreement to build a house or apartment, the transfer of the site is chargeable at the non-residential rates in the table below.

if the second case applies then its based on 1/4 of 249000 which is under the 127000 cutoff therefore exempt.
 
The house is in Galway which is why it is so expensive. I'm still trying to get my solicitor to sort it out.
 
Unless I am reading the OP incorrectly, they are buying a new property already built with a floor area of 129sqm as opposed to a site and then getting a builder to build. There is a specific table of Stamp Duty rates that apply to this. The consideration amount for stamp duty purposes is the greater of

1) site value (excluding VAT)
2) one quarter of the total value of the house including the site (excluding VAT)

The stamp duty table is as follows...

Chargeable considerationFirst Time BuyerOwner OccupierLess than 127,000 euroExemptExempt127,001 euro - 190,500 euroExempt3%190,501 euro - 254,000 euroExempt4%254,001 euro -317,500 euroExempt5%317,501 euro - 381,000 euro3%6%381,001 euro - 635,000 euro6%7.5%Over 635,000 euro9%9%


But I like your thinking xt40 :) :)
 
:eek: oops, my table did not exactly come out.

Chargeable consideration First Time Buyer Owner Occupier
Less than 127,000 euro Exempt Exempt
127,001 euro - 190,500 euro Exempt 3%
190,501 euro - 254,000 euro Exempt 4%
254,001 euro -317,500 euro Exempt 5%
317,501 euro - 381,000 euro 3% 6%
381,001 euro - 635,000 euro 6% 7.5%
Over 635,000 euro 9% 9%
 
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cos its over 125 sq.m the chargeable consideration is a quarter of the ex vat value .
i bought a new 2500sq. foot house 2 years ago and paid nothing even though it cost over 300k
its a bit perverse that you get hammered when buying a small house yet can get away with it if the house is mansion size or at least over the 125 threshold
 
I know its crap really, just because the house is 4sqm over there is a stamp duty bill. Each one of those sq.m cost nearly €2500. If the site value was less than 127k then there would have been no bill. The most amazing thing is what the Auctioner said about getting a lower site valuation though.

I was just thinking, a friend of mine was selling his house and got a few estate agents to value, however they came up with different sq.footage. He enquired why, the answer he got was that one measured from the outside wall and the other measured from the inside wall. I have no idea if there is a standard guide line for this but it is an interesting thought tho.
 
Eggnog/Xt40,

Can you check my calcs please. Similar position to Nigel27. Looking a trading up to a house > 125 sq m. House is already complete and priced at €445k. Site value is €180k.

Stamp Duty is higher of

€445/1.135 = 392.07 ; 392.07/4 = 98.01 ; <127k exempt

or

€180k @ 3% = €5.4k : Higher so applies

Xt40, you mentioned it could be 9%. I'm a bit confused by this. Only budgeting at this satge so have not approached solicitor or revenue.

Appreciate your thoughts.
 
I am in the same position. Solicitor has paid 14,187.50 to the revenue instead of just 10,000. he will not listen to us when we explain its only 10,000. Site cost is greater then qtr of the purchase price; 250,000 @ 4% = 10,000 but our solicitor has INCLUDED VAT; 250,000 + 13.5% = 283,750 @ 5% = 14,187.50

Am i right in what i am reading that he should have calculated the stamp duty (EXCULING VAT) ????????????
 
Kelb28 said:
Am i right in what i am reading that he should have calculated the stamp duty (EXCULING VAT) ????????????
Click to expand...
As far as I know you are correct and your solicitor seems to be wrong. Did you point him at the Revenue page linked by xt40 above to see what he has to say?
 
ClubMan said:
As far as I know you are correct and your solicitor seems to be wrong. Did you point him at the Revenue page linked by xt40 above to see what he has to say?
Click to expand...

He has not been listening to my partner so i have printed this off and the relvent page on the Revenue website. he better listen now. if we are due the refund is it our solicitor who sorts it out with the revenue or do we do it ourselves?
 
whats strikes me in all this is how incompetent solicitors are in dealing with the financial and tax aspect of a house/land sale yet most (not all) charge a ridiculous amount of money for their services
 
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