How do i work out Stamp Duty Clawback

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cormacol

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Hi all,

I purchased a new house for €370,000 and am going aborad next year (for an indefinate period). I'm trying to work out whether i'd be better off selling or renting it out.

How do i work out the Stamp Duty that will be payable to the revenue if for example i owned the house for a year.
 
A stamp duty 'clawback' arises where rent, other than under the 'Rent a Room scheme' is obtained within the five year period (or up to the date of a sale during this period) from the date of the purchase deed. The amount of the clawback is the difference between (a) the stamp duty payable at the higher rates which would have applied at the date of the purchase deed and (b) the lower duty (if any) paid as a result of obtaining the benefit of the reduced rates.
Under the 'Rent a Room scheme', there is no stamp duty clawback where rent is received by the person in occupation of the house or apartment on or after 6th April, 2001 for letting of furnished accommodation in part of the house.
 
Hi,

Does one need to register with the PRTB if availing of the Rent a Room scheme?

Thanks,

N.
 
cormacol said:
Hi all,

I purchased a new house for €370,000 and am going aborad next year (for an indefinate period). I'm trying to work out whether i'd be better off selling or renting it out.

How do i work out the Stamp Duty that will be payable to the revenue if for example i owned the house for a year.
Click to expand...
Assuming that you paid no SD on the original purchase then the clawback is what an investor would have paid i.e. €370,000 @ 6% = €22,200 (based on current SD rates). Note that the SD clawback is an all or nothing charge and is not calculated pro-rata over the first five year period of ownership (e.g. you don't pay 4/5ths if you were an owner occupier for one year).
 
Clubman! That explanation finally clears the clawback situation up for me. Never fully understood it before. Nice work.
 
If you bought the house new the stamp duty is calculated on the net of vat purchase price. So you get to take 13.5% off before calculating the duty.
 
Thanks Eleazar, but what I posted above has been posted by me and others many times before.

As for the VAT issue I wasn't aware of that so apologies for any confusion caused. I guess it's potentially €370K / 1.135 =~ €326,000 @ 6% = €19,560 so?
 
ClubMan said:
Thanks Eleazar, but what I posted above has been posted by me and others many times before.

As for the VAT issue I wasn't aware of that so apologies for any confusion caused. I guess it's potentially €370K / 1.135 =~ €326,000 @ 6% = €19,560 so?
Click to expand...

Hi Clubman,

Hope I'm not going over old ground, but take the following example.
€278K / 1.135 =~ €245K

Going by the following table:

Aggregate Consideration First Time Buyer Rate
Up to €127,000 Exempt
€127,001 - €190,500 Exempt
€190,501 - €254,000 Exempt
€254,001 - €317,500 Exempt
€317,501 - €381,000 3%
€381,001 - €635,000 6%
Over €635,000 9%

Got the above from here: [broken link removed]

What rate would be used? 3% or would you actually be exempt. I'm not sure what they mean by "higher stamp duty rates"! Is 6% the "Higher Stamp Duty Rate"

Thanks,
Jamie
 
The table you show is for first time buyers. As you're not FTB anymore (you're an investor) you will owe SD due on 245k @ 4% assuming that its a new house originally and that the vat is reduced to find the band. If its the original price of 278k and non vat reduced then its 5%. See link under
Rates of stamp duty for second-hand houses and apartments for other owner-occupiers (and investors)
 
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