Retrospective stamp duty on home

[ethain]

I was told of a issue disscussed on prime time last night - if you own your home and live in it as a home, but rent it out before you have lived there for 5 years then you are liable for stamp duty.

This is of interest to me as I own my own home and lived there for approximately 3.5 years. However because of work I have had to move location. In the meantime I have rented my home. The intent was this was going to be short term move until I figured where was the most suitable location to buy.

When I bought my home the value was €180,000 - it was a new build and I was a first time buyer - so I was exempt from stamp duty.

Now if I understand it correctly - my home is now regarded as an investment property and so I must pay stamp duty???

If I were to sell my home (1) what are the tax implications and (2) is there a time frame in which I need to invest the money in a new home?

 

[CCOVICH]

Yiu are liable for stamp duty at the rate that would have applied to an investor at the time of purchase. The stamp duty is due from the date you first rented the property.

You will only pay CGT pro rated to the time you had your property rented out. E.g. if you have owned the house for 5 years, rented out for 2 of the years, 4/5ths of the gain is exempt (3 years occupation and 1 years deemed occupation-the last 12 months), and you pay tax on 1/5th.

Both of these issues are discussed regularly on AAM, and any questions should be answered in full by reading the Revenue Guides on CAT and CGT, both available on www.revenue.ie

 

[triplex]

The Revenue touted this issue in January/February 2006

The four main areas:

Stamp duty
Rental Income
Capital Gains
Recoupment of mortagage interest relief

i checked this with revenue at the time and this was confirmed.

 

[max]

There is no clawback of stamp duty if you claim rent-a-room relief(up to 7.5k per annum tax free) on the house.

As regards capital gains tax, you can live away from your home for a period of up to four years (required to do so for work reasons) and still claim full relief from CGT under the Principal Private Residence provisions.

 

[CCOVICH]

There is no clawback of stamp duty if you claim rent-a-room relief(up to 7.5k per annum tax free) on the house.claim full relief .

Only if you continue to occupy the house, doesn't appear relevant to the OP

In the meantime I have rented my home.