Stamp Duty Implications - FTB?

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Hel_n

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Hi there

Could anybody tell me if a FTB buying a house for €307k but borrowing €320k would be liable for stamp duty? The contract price and present value is 307K but after home improvements the house would be valued in the region of €350k.

Not sure if it makes a difference but it is a new house.

Thanks
 
If it is a new house under 125sqm then it is exempt from SD for any owner occupier (FTB or not).
 
Not sure if it makes a difference but it is a new house.
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There's no SD for owner occupier of new houses. Are you going to live there ? I presume the improvements are extras that need doing such as electrical points and lighting ?
Doh ! post crossed with CM
 
The house is 151sq m but the purchase price and (therefore the purchase value) is 307k. In order to borrow more money than the pp we need to be able to show the lender that the house is going to be worth more that this after improvements. When calculating SD is it based on the value at time of purchase?
 
Hel_n said:
The house is 151sq m but the purchase price and (therefore the purchase value) is 307k. In order to borrow more money than the pp we need to be able to show the lender that the house is going to be worth more that this after improvements. When calculating SD is it based on the value at time of purchase?
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outlines how the SD is calculated on such a property (i.e. new property over 125sqm) based on the original fair market value/purchase price and/or site value. I am amazed that lenders are advancing more than 100% of the purchase price to be honest!
 
I looked it up and it says that FTBs are exempt from SD up to €317.5k. However, as this case is slightly different and as the mortgage exceeds the SD threshold, I was wondering if this would affect things.

Also, the bank are lending 92% of the purchase price plus extra for home improvements. Most lenders do this but you need to have 8% up front to close the sale and after that they release money as the works are carried out
 
Hel_n

The stamp duty is payable on the contract price to purchase, so there would not be stamp duty payable, the additionally money to fund the improvements will issue after the contract to purchase is completed.


I am amazed that lenders are advancing more than 100% of the purchase price to be honest
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they wont actually be lending more than 100%, the funds for the improvements will be released once the work is fully complete and the original valuer confirms its value after work is €350,000 on a borrowing of €320,000 the LTV is 91.4%
 
Thanks Molly, i thought as much but just wanted to be sure - it wouldn't be worth taking the risk! - thanks again :)
 
Extract from Revenue site on stamp duty

Over Floor Area of 125 sq. m


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

So, no stamp duty is payable even if the property is over the limit
 
There are lots of different types of stamp duty, the Eur40 you pay for your credit card every yr, the stamp duty on a house purchase, the stamp duty on a cheque, the stamp duty on a mortgage deed.


No you will not be liable for stamp duty....the duty you are talking about is base on the amount you are purchasing the house for, not how much you are borrowing.

You will be liable for stamp duty on the mortgage deed, this is charged at Eur1 per Eur1,000. ie. you are borrowing eur320k the stamp duty on the mortgage deed will be Eur320. The exemption for this type of stamp duty is loans under eur254, the maximum payable is eur635.
 
Helen:
- asdfg is correct that the 'value' for stamp duty for a new house means there is in fact a high ceiling of 4 times the limit at 'Nil' because of the 25% situation.

- However, as usual with Revenue, if you buy with another or others, if any one of them are not FTBs then none of you are for SD purposes.
 
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