From Revenue Website
Revenue Reassures First Time Buyers of Second Hand Houses
The position regarding claims for first time buyer relief where the purchase monies are not provided entirely by the first time buyer was addressed in material which was published on the Revenue website in April this year. The stamp duty treatment was included in an answer in a FAQ format as follows:
What is the position where the purchase monies are not provided entirely by the first time buyer?
To qualify for the relief the entirety of the purchase monies, including any borrowings, must be provided by the first time buyer. Any person, who provides part of the purchase monies or who is a party to any borrowings relating to such purchase, is also regarded as a buyer of the house and the relief will not be available unless that other person is also a first time buyer. …
This treatment applies whether or not all the parties providing the purchase monies, or all the parties to any borrowings, are actually named in the deed of transfer.
Notwithstanding this treatment, to take account of the particular circumstances which have arisen, Revenue is prepared to accept that a child, who is a first time buyer, will not be precluded from claiming first time buyer relief where a parent acts as a co-mortgagor in the following circumstances:
* The transfer of the house is taken in the name of the child.
* It is the intention of both the child and the parent that the parent is not to take a beneficial interest in the house.
* The parent has been joined into the mortgage solely at the request of the lending institution for the purpose of providing additional security for the monies being advanced for the purchase.
* It is not intended that the parent will be contributing to the repayment of the mortgage in the normal course.
Where the four conditions set out above are satisfied, Revenue will treat the parent as effectively acting in the role of guarantor for the loan.
Consistent with the above approach, Revenue will also be prepared to treat persons other than parents of the first time buyer, who satisfy similar conditions to those set out above, as effectively acting in the role of guarantor for the loan. Their involvement in that capacity will not be treated by Revenue as precluding a claim to first time buyer relief. In such circumstances the conditions are as follows:
* The transfer of the house is taken in the name of the first time buyer.
* It is the intention of both the first time buyer and the other person that the other person is not to take a beneficial interest in the house.
* The other person has been joined into the mortgage solely at the request of the lending institution for the purpose of providing additional security for the monies being advanced for the purchase.
* It is not intended that the other person will be contributing to the repayment of the mortgage in the normal course.
Revenue do not propose to seek a claw back of stamp duty where transfers have taken place before today which comply with either set of conditions outlined above. There is no need for taxpayers or their advisors to consult Revenue unless the circumstances surrounding the purchase are different to those outlined above.
The relief from stamp duty is intended to benefit only genuine first time buyers and Revenue will continue to user our audit programme to ensure that there is no abuse of the relief.
Ends 24/06/05
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