Stamp Duty on a house is liable from when ?

J

Jonathan

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I have heard that there is a 30 day period of grace between purchasing a house and paying the stamp duty (assuming you are liable for stamp duty). If a house is purchased on the 7th of November 2006 (loan cheque cashed by the other side), and if 30 days later stamp duty is reduced in the 2007 budget (6th of December), will the new reduced rates of stamp duty in the 2007 apply to the house purchased 30 days previously, or which date is important: a]exchange of contract date, b]closing date and cashing of cheque by vendor, c] date the solicitor puts on the deed of transfer, assuming the solicitor can do this up to the 30 days beyond the sale.
 
As far as I know your solicitor will normally require the SD on closing and will remit it to Revenue withing c. 30 days.
 
I have the same issue, my solicitor is saying it is probably when I signed the contracts (regardless of the vendor signing) as I was "prepared to pay the stamp duty at that time" which makes no sense to me as theoretically I could ask him to scrap those contracts and get them re-done.

I can't find the answer on revenue.ie.

When is "closing" - they can't go on the "date you get the keys"! Unless they simply follow the closing date mentioned in the contracts - which may not be actually adhered to....
 
I too am in the same situation, and solicitor didn't know for sure either!
Love to hear the answer to this one, anybody?
 
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This is the advice I received from my bank, at the time we were "buying" our home!

From the cheque issue date you will then have 30 days to come up with the remainder required to pay the Stamp duty in full.


 
so you maintain that the date the mortgage cheque is issued is the valid date for which rate of stamp duty will apply? (assuming the rate changes!)

I doubt it!
 
When is stamp duty payable?

Up to 30 days after completion. date

When is completion date?

The date there is a formal handing over of funds for keys and vacant possession.
That date ties in to searches date.

If a house is bought on 7/11, the stamp duty regime as at that date is the applicable rate. If the rate changes in the budget, it does not change the date that the deal was completed.

Which if these dates is relevant?

a] exchange of contract date, - there is an argument that this is the day the formal deal was agreed although not yet completed.

b] closing date, - my view the correct date to be used for stamp duty purposes
and cashing of cheque by vendor- irrelevant

c] date the solicitor puts on the deed of transfer, assuming the solicitor can do this up to the 30 days beyond the sale.
The date of the deed is the date of closing/completion. It’s not an arbitrary date that the solicitor should decide. Does it ever happen that the date is different? Yes, but its preferable that it is one clear day.

The solicitor does require the stamp duty on closing – if there is a mortgage the lender requires the solicitor to be in funds to stamp and register the deed before releasing the loan cheque. Clients often forget about the stamp duty as soon as they move in and it can be a nightmare trying to force the stamp duty out of them. So you don’t – you get it in advance.

“From the cheque issue date you will then have 30 days to come up with the remainder required to pay the Stamp duty in full. “

In fuzzy theory yes- in practice no. The solicitor cannot release the loan cheque until they are in funds as above.

The date the mortgage cheque is issued is the valid date for which rate of stamp duty will apply?

The date of the issue of the mortgage cheque has diddly squat to do with stamp duty. Loan cheques can issue several weeks in advance of closing.

mf
 
Thanks for that mf. Sigh!

mf1 said:
a] exchange of contract date, - there is an argument that this is the day the formal deal was agreed although not yet completed.
Click to expand...

That would be extremely unfair if a delay in closing of a few months took place!



According to a revenue webpage I was looking at the wording was as follows when changes were introduced for first time buyers a couple of years ago:

"The rates of duty for first time buyers have been reduced for deeds of conveyance or transfer executed on or after"

So when is a deed executed?
 
podgerodge said:
so you maintain that the date the mortgage cheque is issued is the valid date for which rate of stamp duty will apply? (assuming the rate changes!)

I doubt it!
Click to expand...

As you will see from my post, it was what PTSB told me, I went to the trouble of siefting throw my emails from them to find that information for you - ungrateful sod. I am not an expert. Just posting on information I received.
 
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sulo said:
As you will see from my post, it was what PTSB told me, I went to the trouble of siefting throw my emails from them to find that information for you - ungrateful sod. I am not an expert. Just posting on information I received.
Click to expand...


Relax Sulo, you are completely misunderstanding me. My "I doubt it!" was merely a way of saying "No such luck"!
 
podgerodge said:
Relax Sulo, you are completely misunderstanding me. My "I doubt it!" was merely a way of saying "No such luck"!
Click to expand...

Absolutely relaxed, but u are right, it was a misunderstanding of "tone" - very hard to detect that from static text!

Btw, went to see the real "podge and rodge" last night! Excellent, ripping the proverbial out of "Chris BROSNAN"s celebrity, drugs, and women !!!
 
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So when is a deed executed?

b] closing date, - my view the correct date to be used for stamp duty purposes

The date that is on the deed.

My own view? The paperwork all ties in. The date on the deed should be the date that funds are exchanged for title and vacant possession which should be the date to which searches are done which should be the date that goes on the mortgage.

The mortgage deed may have been signed by the purchaser months in advance. The Deed may be signed a few days or weeks after closing but the date of the Deed should be as above. And that is the date of execution.

mf
 
I agree but...

If the closing date - the date on the deed , turns out not to be the actual closing date - which ends up being a month later, could this be successfully argued?

actually another revenue page states "This means the date on which the deed takes effect and is normally
the date on the deed"

Normally...hmmmmmm
 
"If the closing date - the date on the deed , turns out not to be the actual closing date - which ends up being a month later, could this be successfully argued?"

Of course. Be careful not to confuse closing date in contract with actual closing date - the date of the deed.

Its not the nominated closing date in the Contract ( which is mostly aspirational anyway) - its the actual closing date. The day the vendor must have vacated, the day the money changes hands, the day the purchaser is actually entitled to take possession. That is the closing date, that is the date the deed should be dated. And that is the date from which the 30 day grace period for stamp duty is calculated.

mf
 
Thanks mf1

I hope you are correct!

Pity everything on revenue is a little vague!

As 1st december is currently my 'closing date' I take it I should delay paying and taking the keys for another week after that and see what happens!
 
I think a lot of current purchasers are hoping to delay a closing until December 8th to see what happens, in the hope that there will be a reduction in stamp duty.

And if there is an increase in stamp duty on the day..............

I'm only askin'

mf
 
As 1st december is currently my 'closing date' I take it I should delay paying and taking the keys for another week after that and see what happens!
Click to expand...

I don't understand why you would when the regime applicable is dictated by the date of the contracts, although the stamp duty is not due until 30 days after closing.
 
Hi Vanilla - I know you posted before about the applicable date for stamp duty regime when there is a change in the regime. I understood that you had had very specific dealings on the point.

I've always worked on the basis of stamp duty regime applicable as at date of completion and have had deeds etc. stamped on that basis. Did Revenue point you towards any specific provisions in the legislation ref. contract date being applicable?

I'm very interested because even though I don't think there will be a change on December 8th I'd like to get a (the?) definitive answer on relevant date.

mf
 
Only based on what mf1 thinks



and what I read on the revenue website saying that stamp duty is payable based on "the date on which the deed takes effect" - not the contracts.
 
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