Is there tax on the transfer of house sale proceeds from Newry to Dundalk?

salmon2

I live in Newry and wish to sell my house in order to move to and purchase a house in Dundalk, in order to be closer to family members. The house I purchase in Dundalk would then become my principal residence and would not be rented out or used for commercial activities.

When I sell my house in Newry (which has always been my primary residence and was never rented out or used for any commercial activities) I will then have to send the proceeds of the house sale by bank transfer from my bank account in Newry to Dundalk.

I presume I simply send by bank transfer direct to the solicitor dealing with my purchase in Dundalk.

I realise there is stamp duty on the purchase of the house in Dundalk, but what I'm wondering is if there is any form of tax (in the Republic) on the finance which I will transfer from from the sale of my house in Newry?

Maybe some sort of tax on the bringing of capital into the country from another country. I don't think there is, but just thought I would ask

Kinetic^

It's a CGT transaction.

The most tax efficent way of dealing with this is not to buy unless you have sold. Easier said then done but if you move the PPR status from Newry to Dundalk while still owning both, then your Newry property will be liable to CGT if there are any profits made from it. They'll be proportioned to the amound of time you spent there.

Example:

Bought Newry House 200k.

Bought Dundalk house 2 years later and moved into it.

Sold Newry House a year after moving out for 250k.

So your profit is 50k and you occupied it for 2 out of 3 years.

So 50k * 20% = 10k - (10k*2/3) (occupancy rate) = 3.4k CGT liability.

I've simplified it but it's more or less like that.

smcgiff

Can't see how you could.

If there were any tax to be paid it would be capital gains tax on gain within the UK - but I'm guessing this would be covered under similar PPR exemption rules.

I don't see how you would be taxable for remitting funds from the UK to the ROI.

salmon2

Thanks Kenny - the house in Newry would be sold before I purchase the house in Dundalk.

So, hopefully, I don't think any CGT is applicable.

I have lived in the house in Newry for 5 years as my primary residence, I sell it, I transfer the funds to Dundalk and purchase my new primary residence there.

Just wondered if there is any tax on the transfer of funds into the state?

salmon2

smcgiff wrote:

If there were any tax to be paid it would be capital gains tax on gain within the UK - but I'm guessing this would be covered under similar PPR exemption rules.

I don't see how you would be taxable for remitting funds from the UK to the ROI.

Yes it would be covered under similar PPR rules. Just wondered if there was any Irish tax on the transfer of payment from one country into the State. I didn't think there was, but just thought I'd ask...

Kinetic^

No not at all. Although i'm sure they'd like to take some of it :rolleyes:

smcgiff

salmon2 wrote:

Just wondered if there was any Irish tax on the transfer of payment from one country into the State.

Jaysus! Don't give them any ideas!

salmon2

Ooopps sorry about that - MOD feel free to delete thread...:)

Kinetic^

smcgiff wrote:

Jaysus! Don't give them any ideas!

Lol, I know yeah they screw us enough with adding to the pain!!! :mad:

kluivert

No tax implications.

There is catch but wont affect you.

I cant remember the residence rule fully (three years ago when i took the exam).

At the mo your non resident in Ireland. When you move here, its tax free including the exemption from having to pay VRT on the car.

I remember something like, if you bought a house in Dundalk and a year later you sold the house in Newry you could be liable for CGT, as the revenue could see if as a taxed gain from the sale of foreign owed property, and all world wide income is subject to tax here, and thus CGT may arise.

It takes three years to become fully ordinary resident and ordinary domicle, meaning Irish for tax purposes, but there are different rules for the time in between.

I think this is the point Kenny is getting at.

But to answer your question, NO tax implications on the transfer of funds, you can either deposit it with your solicitor or leave it in a deposit account earning interest till you buy your house, then transfer the funds to your solictor to transfer to funds to the vendors solicitors.

Bank Fees are all you will incur.

Kinetic^

kluivert wrote:

I think this is the point Kenny is getting at.

Er yes, yes it is!!!

salmon2

Ok - thanks guys