Stamp duty on houses greater than 125sq m

B

bobo2006

Guest
Does 125k exemption apply

Annex G isn't clear (for me at least) on the following:

Owner occupier buying a new house above 125sq m. As per bleary they "are liable to stamp duty on the greater of the site value or 25% of the property value (excluding VAT)
at the standard rates, thresholds and exemption."

But does this mean that the 125k exemption applies to those people who's stamp duty was based on greater of 1/4 of house value vs value of land? I.e. do they benefit? I have a brother in law buying in this category. Would love to tell him good news but its not very clear to me so don't want to blurt anything out that's not true.


bleary said:
http://www.budget.gov.ie/2008/downloads/AnnexG.pdf

This seems to apply to new properties too and also to investment properties from my reading

These tables relate to the standard residential Stamp Duty regime. First-time purchasers of all residential property and other owner-occupying purchasers of new residential property under 125m2 are
exempt from stamp duty. Other owner-occupying purchasers of new residential property over 125m2 are liable to stamp duty on the greater of the site value or 25% of the property value (excluding VAT)
at the standard rates, thresholds and exemption.

Residential property is defined as a building or part of a building which at
the date the deed is signed was used or was suitable for use as a dwelling.
Click to expand...
 
Re: Stamp Duty Changes

On my reading the 125000 exemption would apply to 25% rule cases
 
This has puzzled me for some time now.

e.g. I buy a house > 125 sq m, second time buyer, for 360k total, site worth 80k.

So I am charged SD on 25% of 360k = 90k (as that is > 80k site value).

Does that mean I am charged zero SD as 90k is < 125k ?

OR:

Am I charged 25% of the SD payable on 360k

i.e. 25% of (7% of 235k)

= approx 4k

Would Love to know the correct answer to this please.

Many thanks.
 
Last edited:
eamonn123456 said:
So I am charged SD on 25% of 360k = 90k
Click to expand...
Isn't it 25% of the building costs less VAT and not the market value of the property that counts?
Does that mean I am charged zero SD as 90k is < 125k ?
Click to expand...
I think that SD is calculated on the chargeable consideration which is the greater of 25% of the building costs less VAT or the site value. Not on the market value.
 
Thanks ClubMan.

If that is so, then even better.

So in this case I can pay a builder anything up to 500K
(or more correctly 508k = 4 x 127k which is the point at which SD is chargeable)
to build a house on anything up to a 127k site,
and I will pay 0 SD?
 
I think that's correct. But if in doubt double check the Revenue and CitizensInformation sites and/or get professional advice.
 
Thanks Clubman. I have looked before and the wording is somewhat ambiguous:

Revenue website - Over Floor Area of 125 sq. m
New houses or apartments which are purchased by an owner occupier 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.

A charge to stamp duty will not arise for first time buyers who are owner-occupiers of such houses.



CI website seems clearer - If the area of the house or flat is greater than 125 sq. metres (1,346 sq. feet), some stamp duty is payable if the Chargeable Consideration is above the relevant exemption threshold. (The stamp duty is assessed on either the cost of the site or 25% of the cost of the site plus the building costs (less VAT), whichever is the greater figure. This figure is called the Chargeable Consideration.

I can see that in my example the chargeable consideration would be 440k (assuming my 360k did not include VAT).

So, am I right in thinking I would be charged stamp duty on 25% of 440k i.e. on 110k, which is < than the 127k threshold, so therefore no stamp duty?

If so, it would prob be worth the hassle of going down the 'get one built' road....
 
You are correct in whay you say there Eamonn123456. No stamp duty on the figures you gave. Also if your quartered total figure or site value (whichever was the greater) was over the 127,000, then the 125,000 exemption would come into play and the 125,000 would be deducted then the balance charged at 7%. Also the old 127,00 exemption threshold still applies as normal so no one would be caught for duty on figures under 127,001
 
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