Stamp Duty - No Clawback

Hi people..i have been reading about this topic on this forum for the last couple of months.basically i am moving to oz for a few years and i was worried that i would be liable for stamp duty clawback as i bought my house only last year.

However after recieving independant tax advice i am fairly certain that i am not liable. basically the clawback applies only "if at the time of purchase your intention was to rent it out at some stage within five years".

At my time of purchase i fully intended to stay in it for at least 5 years but i have been given an opportunity to live in oz for a few years .Therefore the stamp duty on my mortage transaction does not apply. that is the way my tax advisor has read the relevant piece of legislation and she is fairly confident i would not be liable.

I have to be honest and say as far as I was concerned, it can be clawed back if you rent the house within 5 years. Has nothing to do with initial intentions. That sounds too easy a cop out for me. Can't believe revenue would allow a loophole like that.

is stamp duty not a tax on a transaction though? at the time of the transaction my intentions were to stay in the house for at least five years so i can see the logic in it. the tax advisor told me she has advised a good few people on this issue and it is based on the way the legislation is worded.

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Clawback

A clawback arises if rent is obtained from the letting of the house or apartment for a period of 5 years from the date of the conveyance or transfer, other than under the rent-a-room scheme. The clawback amounts to the difference between the higher stamp duty rates and the duty paid and it becomes payable on the date that rent is first received from the property. A clawback will not arise where the property is sold to an unrelated third party during the 5-year period.

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What is the rent-a-room scheme?

Under this scheme there is no clawback of the first time buyer relief where rent is received by the person in occupation of the house, on or after 6 April 2001, for the letting of furnished accommodation in part of the house.

When does a clawback arise?

A clawback arises if rent is obtained from the letting of the house, other than under the rent-a-room scheme. The clawback amounts to the difference between the higher stamp duty rates and the duty paid and it becomes payable on the date that rent is first received from the property.

RMUL90 said:

However after recieving independant tax advice i am fairly certain that i am not liable. basically the clawback applies only "if at the time of purchase your intention was to rent it out at some stage within five years".

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Did you go to a reputable independant tax advisor? If so, you should go back to your advisor and seriously question their advice, which seems on the face of it to be suspect in the extreme.

This sounds like terrible advice. What qualifications does this tax advisor have?

RMUL90 said:

Lads...i am moving to oz and i am in the same situation. i am seriously thinking about forgetting the sd clawback as it is simply too expensive.i know loads of people who have done the same thing and have never been chased by the revenue. a lot of people dont even think about stuff like this and they just sail on and never get caught. For me to pay it would involve remortgaging the property and it is just a load of hassle.....

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Bloody troll....