Stamp Duty on purchase of business

C

Chas

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How would stamp duty be calculated on the purchase of a business as a going concern for €100,000 if the components of the purchase were split as follows -
€5,000 value of outstanding portion of lease
€25,000 value of machinery
€70,000 value of goodwill, i.e established customer base

What actions would be possible to minimise or even eliminate the potential for stamp duty?
 
And how would the stamp duty on the assignment of the lease be caculated, based on 2 years and 2 months outstanding on existing lease, €7000 per annum rental rising at 5% p.a.
I found the foolwoing on one solicitors website...

Stamp Duty is payable by a tenant at the start of the lease at the rate of 1% of the annual rent. If a tenant pays a premium to acquire the leasehold interest, then stamp duty will be payable at 6% on any premium in excess of IR£60,000 ( 76,184.28).

I'm at a loss to understand how the revenue have caculated that I owe them €5.5K stamp duty on a £7K p.a. lease with only 2 years left to run.
Would the fact that my solicitor negotiated the option of a 35 year lease have any bearing?
 
Note that you have the option not to convey plant and machinery, instead simply these items are transferred by delivery
 
What is the advantage of not coveying plant and machinery/ fittings?
I am currently in the process of buying a lease on a shop and was wondering how stamp duty was calculatedon it?
 
My solicitor has phoned to say she has been in negotiations with the revenue and I'm due to pay stamp duty on both the lease and the goodwill. Can anyone provide some clarity here - what part of revenue legislation (if thats the right word) applies in calculating stamp duty on transfer of business and which parts of the sale are included/excluded? I'd like to be able to quote details to solicitor. Thanks.
 
I am not a tax expert and I strongly believe that you should get independent, professional tax advice if your solicitor is not in a position to give you this but I did a search on www.IrishStatuteBook.ie for the terms "goodwill" and "capital gains tax" and got in case it's of any use. Just to reiterate this is not in any way tax advice!
 
Surely the best evidence you could go back with to your solicitor is an opinion (or a meeting) with a tax advisor who tells you how much tax you have to pay?

In response to an earlier post - the advantage to passing items by delivery is that there will be no stamp duty on such items. Stamp duty is a tax on documents. Certain items may not be passed by delivery and must be conveyed by a written document e.g. real estate.
 
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