Trying to avoid Stamp Duty on My Parents House

A

aoa321

Guest
Hi all,

I am going to buy my parents house from them - is there any way of giving them a low value for the house (to keep the sale price in a lower Stamp Duty bracket) and give them a "gift" of the balance?

It's probably a stupid question ... but I just thought I'd ask.
 
Stamp Duty is payable on the market value of the property. There is no way around that except fraud and lying. If you lie, you will probably be caught out and will pay fines and interest to the Revenue.

If X takes a gift of a house from parents with no consideration passing, stamp duty is paid on the market value of the property normally supported by a valuation from an auctioneer.

If x takes a gift of the house but pays less than market value, stamp duty is still paid on the market value.

Unpalatable as it may be, console yourself that as a related party, you only pay stamp duty at half the ad valorem rate.

mf
 
thank you

I have no intention of lying or of being fraudulent. I am aware of the 50% reduction in the stamp duty rate, I am just trying to ensure that we transfer the house in the most tax efficient way possible.

I don't want to make the purchase now and find out in a few weeks time that I could have saved myself and my parents a few quid by going about it in a different way.
 
Could you consider buying two things from your parents - 1) The house 2) The contents of the house?
I have heard of people doing this. I have also heard of people buying the site that the house is built on, seperatly from the house
Might these ideas work?
 
No, No, No, No, No, No, No.

Stamp duty is payable on the market value of the property.
House and contents separate contracts are specifically covered by Revenue Certificates. If there are connected contracts and they bridge a stamp duty threshold, then stamp duty is payable on the lower amount ( ex. contents) at the higher rate ( both contracts)

As for the idea that you can separate the land from the house, brilliant - why did none of us ever think of that before? Mainly because it won't wash. At all.

mf
 
mf,

I asked a relatively simple question - if in your eyes it was a stupid question you are perfectly entitled to that view.

But I resent the abusive, overhanded and arrogant tone that you have displayed in your replies. If you are knowledgable in the area of property tax (and clearly you feel that you are) and there is no way of reducing the amount of stamp duty to be paid well just say so and leave it at that.

I have been using this board for a long time now as a source for helpful, human and informative answers to the sorts of questions that you clearly feel are beneath you.

Mostly of the replies I have received have been very helpful. There are a few wits around and I have no problem with that, nor do I mind having it pointed out to me when I am completley wrong.

What I do mind (and what has affected my enjoyment of this board in the past as now) is the arrogant, abusive and half-informed bores like you who hide behind the anonimity, who don't know when to stop typing, and who seem determined to advertise to the rest of us the fact that they have nothing better do with thier day.
 
Actually, I don't believe I was offensive, or abusive nor did I call you or your question stupid. I gave you a factual response to the question whether you could avoid stamp duty. The answer is yes, but only if you lie or attempt to defraud the Revenue.

Stamp duty is a tax that affects a lot of people and there is a constant stream of questions on Askaboutmoney such as yours. There is equally a constant stream of uninformed answers which fail to deal with the legality or reality of the situation.

Oh and by the way yes, I am knowledgeable in the area which is why I can answer the question with a degree of certainty. So take the advice in the spirt in which it was offered, not as a personal attack on a complete stranger.

mf
 
mf

I can't be bothered getting into this with you, you answered the question, I acknowledged that.

I didn't like the tone you took when replying to my posting, whatever spirit it was intended to be in. I liked the tone of your second reply even less. As you have the right to comment on my posting I have the right to comment on your postings.

I presumed you'd be back with a wordy reply, but as I say I can't be bothered getting into this.
 
Sorry but I can't resist....
...is the arrogant, abusive and half-informed bores like you who hide behind the anonimity
Click to expand...
Have you looked at your own
Everything's private

Let those without sin cast the first stone and all that :b
 
I didn't like the tone you took when replying to my posting, whatever spirit it was intended to be in. I liked the tone of your second reply even less.
Click to expand...
There was absolutely nothing in the slightest way offensive or questionable about the tone of MF's first response. Any dislike you took to this response had more to do with the content of the answer which didn't suit your purposes than the tone. MF's second response was not directed at the original poster and was directed and Munsterdude's suggestion.
 
The problem with e-mail/forums is that everybody has their own individual interpretation of the tone of a message/response. Lets just call it quits and think twice before pressing "Add Reply" in the future.

Stamp Duty is payable on the market value of the property
Click to expand...

What I'd like to know is how the market value is determined?

Ask a few Auctioneers and they will all offer a different valuation!

Take the garage sold this week in Ranelagh. Sherry Fitz were guiding €150k, but it sold for €360k!
 
Stamp Duty is payable on the market value of the property

In simple terms, market value is the price a property would make if sold on the open market to a willing purchaser. It is supported ordinarily by a written valuation from a person competent to make that valuation.

If its a genuine sale situation, the price achieved is the market value.

In a voluntary conveyance situation, say between parent and child, because there is a consanguinity relief ( pay at half the rate), any deed is adjudicated by Revenue to get the relief. If they are not satisfied with the valuation, they will send the Deed to their own Valuation Office.

Market value is relatively easy to define for any bog standard property - it is more difficult with something marginally unusual e.g. the garage sold for twice the guide. But then the market value was the sale price.

Markate value also tends to ultimately find its own level - e.g. you inherit or are gifted a property, it has a market value ( ordinarily set with a written valuation). You may have a CAT liability if it exceeds the threshold. You get the property at current market value - set with the valuation- and if you subsequently sell, any CGT will be referenced back to market value as at date of acquisition.

mf
 
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